Consolidation, Refinancing and Public Service Loan Forgiveness


A Direct Consolidation Loan allows you to consolidate (combine) one or more federal education loans into a new Direct Consolidation Loan for the purpose of lowering your monthly payment amount or gaining access to federal forgiveness programs. The decision to consolidate should be made carefully. Consolidation is not required but may be necessary in some instances. Be sure and look at the facts about consolidation when making this decision.


If you have good credit, you may be able to refinance your existing federal student loans into a private loan. Before doing that, it’s important to understand the full impact of making this permanent change to your loans. As a federal student loan borrower, you have certain rights that are not typically available with private loans. While refinancing your federal student loans into a private student loan can sometimes lower your interest rate, your private student loan will not necessarily have the same terms and conditions as your federal student loan.

Public Service Loan Forgiveness 

A group of people in scrubs smiling

In addition to the state, federal and/or county programs found in the AAMC database, there is also a federal program, Public Service Loan Forgiveness (PSLF), that may be of interest to federal loan borrowers. After meeting the requirements for PSLF, if a borrower has a remaining federal Direct Loan balance, their loan balance is forgiven, and the amount forgiven is non-taxable.

New rules for Public Service Loan Forgiveness have been implemented so be sure to learn what those are and how they may impact your loan repayment strategies.