PLUS Loan Consolidation Benefits
All new Parent PLUS Loans disbursed by the Direct Loan program have a fixed interest rate of 7.9%, and a consolidation loan will use a weighted average of this. If you are consolidating older PLUS loans, you may be able to lower your interest rate, as new federal consolidation loans are capped at 8.25%.
You may also be eligible for an additional 0.25% rate reduction if you sign up to have your payments auto-debited from a bank account each month. Check the Direct Loan Servicing website for more details.
Other Benefits of PLUS Loan Consolidation
- Reduce your monthly payment up to 53% and beat inflation
- Make one loan payment a month
- Improve your credit rating
- There are no application or origination fees, and no credit checks
- There are no balance requirements for Parent PLUS Loan consolidation
Requirements to Consolidate PLUS Loans
- You must have received the final disbursement for the current academic year – you do not have to wait until your child has graduated!
- You cannot have a Federal loan that is currently in default.
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Consolidation can significantly reduce your monthly payment burden. PLUS Loan Consolidation allows you to stretch your repayment period from the standard 10-years to up to 30-years, depending on the amount of your education debts. The lower payment means you'll have more money available to meet other household expenses, like car payments, childcare, and career-related necessities.