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School Loan Consolidation and
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Home > Search > School Loan Consolidation
What are Federal Student Loans and Federal
Student Loan Consolidation?
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These loans supply financial help for those
who are a student enrolled at a school that
participates in federal aid programs. When
referring to a "school," this means a
two-year or four-year public or private
college, university, or trade school. These
loans are offered by private organizations
under accordance from the US Department of
Education through the Federal Family
Education Loan Program
(FFELP) and the
Federal Direct Student Loan Program (FDLP).
Federal student loans generally cover school
expenses, including tuition and fees, room
and board, books and school supplies, as
well as any transportation. Loans can also
help pay for technology needs (i.e., a
computer) and for necessary dependent care.
There are a variety of federal student loan
programs. Check with your school to see
which programs they participate in.
Federal Student Loan Consolidation
If a student has a series of loans,
through the Stafford, PLUS or Perkins
programs, they have the option to
consolidate these federal student loans into
one single debt. This results in reduced
monthly repayments and a longer term for the
loan, at a fixed interest rate. The term of
the loan can be between 10-30 years.
Although the monthly repayments are lower,
the total amount paid over the term of the
loan is higher than would be paid with other
loans. The calculated fixed interest rate is
based on the average rate of the loans being
consolidated. These rates are weighted,
based on the amounts borrowed.
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