Federal Consolidation Loans: Students and parents may have borrowed from multiple federal loan programs or multiple lenders. If that is the case, they may be having difficulty making the monthly payments. A loan consolidation can help to lower the monthly payments while giving the borrower more time to repay. Although a consolidation loan can help to ease the burden of monthly payments, the borrower will pay much more in interest over the life of the loan and lose many of the provisions of their original loan promissory note. The advantages and disadvantages should be weighed carefully before agreeing to a loan consolidation.
Most lenders have ceased offering consolidation loans, however the U.S. Department of Education offers a Federal Direct Loan Consolidation. You may contact the U.S. Department of Education's Federal Direct Loan Consolidation program for additional information.
