Borrowers with certain types of federal student loans have until today to consolidate their loans in order to qualify for full student loan cancellation or credit towards cancellation. The Education Department is set to conduct a one-time adjustment over the summer, but those interested in being considered for this adjustment must submit a request to consolidate their loans by the deadline. This adjustment aims to provide a more accurate payment count for student loan borrowers. Borrowers with Commercially managed Federal Family Education Loan (FFEL) loans, Parent PLUS loans, Perkins loans, and Health Education Assistance Loan (HEAL) Program loans are required to consolidate their loans to take advantage of this one-time adjustment.
The deadline to consolidate loans is Tuesday. Loan consolidation allows individuals with multiple federal student loans to combine them into one loan with fixed interest rates. By consolidating loans into a Direct Consolidation Loan, borrowers can have a single monthly payment instead of multiple payments each month. The process of loan consolidation is free, and once completed, individuals will become eligible for the forthcoming adjustment by the Education Department. Interested borrowers can apply for loan consolidation through studentaid.gov/loan-consolidation, with the process typically taking around 60 days to finalize.
Following the submission of requests for loan consolidation, the Education Department is currently in the process of adjusting borrowers’ accounts, with an expected completion date by July 1. Borrowers who successfully consolidate their loans and are eligible for the adjustment will receive notification regarding the cancellation of their loans or credit towards cancellation. The Associated Press is supported by the Charles Schwab Foundation for educational and explanatory reporting to enhance financial literacy. It is important to note that the foundation is distinct from Charles Schwab and Co. Inc., and the AP retains sole responsibility for its journalism.
