Direct Consolidation Loans

Who is eligible for a Direct Consolidation Loan?
You can get a Direct Consolidation Loan during your grace period, once you have entered repayment, or during periods of deferment or forbearance. You must consolidate at least one Direct Loan or FFEL. If you don't have a Direct Loan, but you have a FFEL, you must first contact a FFEL lender who makes FFEL Consolidation Loans to ask about obtaining a FFEL Consolidation Loan. If you are unable to
obtain a FFEL Consolidation Loan or you are unable to obtain one with income-sensitive repayment terms that are acceptable to you and you are eligible for the Direct Loan Income Contingent Repayment Plan, you are eligible to apply for a Direct Consolidation Loan.

If you are still in school, you may apply for a Direct Consolidation Loan for any Direct Loans or FFELs if you (a) are attending at least half time* and (b) have at least one Direct Loan or FFEL program in an "in-school period."

(Generally, your loan is in an in-school period if you have been continuously enrolled at least half time* since the loan was disbursed.) In addition, if the school you are attending is not a Direct Loan school, at least one of the loans that you consolidate must be a Direct Loan.
If you're in default* on a federal student loan, you might be able to receive a Direct Consolidation Loan. For more information, contact the Loan Origination Center's Consolidation Department at Loan Origination Center's Consolidation Department 1-800-557-7392

The Center answers your questions between 8 a.m. and 8 p.m. (Eastern Time), Monday through Friday. loanconsolidation.ed.gov
TTY users may call 1-800-557-7395.

What kinds of loans can be consolidated under a Direct Consolidation Loan?
All the loans discussed in this publication are eligible for consolidation. The Loan Origination Center's Consolidation Department can give you a complete listing of eligible loans. There are three categories of Direct Consolidation Loans:

• Direct Subsidized Consolidation Loans
• Direct Unsubsidized Consolidation Loans
• Direct PLUS Consolidation Loans

If you have loans from more than one category, you still have only one Direct Consolidation Loan and make only one monthly payment. However, interest rates differ, as do repayment and deferment options, depending on the loan category.

How do I pay back my Direct Consolidation Loan?
Generally, all the Direct Loan repayment plans are available to borrowers of Direct Consolidation Loans. However, Direct PLUS Consolidation Loans are not eligible to be repaid under the Income Contingent Repayment Plan or might not be eligible for some
discharge/cancellation benefits.

What are repayment incentives?
Incentives are sometimes offered to students who repay their loans on time. These incentives might come in the form of interest rate rebates or reductions. For information on repayment incentives and their availability contact the Loan Origination Center's Consolidation
Department (see above).

How can I get a Direct Consolidation Loan?
You'll be given more information about Consolidation Loans during entrance and exit counseling sessions at your school. You may also contact the Loan Origination Center's Consolidation Department at the number and Web site address listed above.


Go on to Consolidation Loans Page 23 - FFEL Consolidation Loans Page 25 - Campus Based Programs Page 26