Federal help consolidating student loans

Although the FFEL program is federal, it is mostly administered through state or private nonprofit agencies called guaranty agencies.

Guaranty agencies pay off the lenders when borrowers default, and in turn, are reinsured by the Department of Education.

For instance, some or all of your loan could be forgiven in exchange for your performing certain types of service such as teaching or public service.

You can consolidate all, just some, or even just one of your student loans.

Each servicer has its own payment process and can work with you if you need help making payments. Do you get paid after your student loan payment is due each month?

If so, contact your loan servicer and ask whether you’d be able to switch the date your student loan payment is due. What you ultimately pay depends on the plan you choose and when you borrowed.

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WARNING: It is very dangerous to consolidate federal loans into a private consolidation loan.

Under the Direct Loan Consolidation Program, you can consolidate Subsidized and Unsubsidized Stafford Loans, Supplemental Loans for Students (SLSs), Federally Insured Student Loans (FISLs), PLUS Loans, Direct Loans, Perkins Loans, Health Education Assistance Loans (HEALs), and just about any other type of federal student loan.

Loans that are not eligible for consolidation include state or private loans that are not federally guaranteed.

Direct Loans and Federal Family Education Loans (FFEL) are the two largest government federal student loan programs.

As of July 1, 2010, the FFEL program was eliminated.

So Fi is one of few lenders that handles federal and private student loan consolidation.

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