Reconsolidate Student Loans If Already Consolidated

Q: Can I reconsolidate my student loans if I’ve already consolidated them once before, basically consolidate my student loans again for a better rate, or am I locked into this current consolidation loan?

A: In general, once a borrower consolidates their student loans, they cannot reconsolidate or keep consolidating their current consolidation loan into a new consolidation loan. Essentially, once the borrower has consolidated their student loans, they no longer have multiple student loans to consolidate; they have one or sometimes two new consolidation loan(s). However, there are a couple exceptions to this rule:

1. If the borrower has Federal Family Education Loans (FFEL) student loans, they may have the ability to consolidate into the Direct Loan program to qualify for Public Service Loan Forgiveness, even if they have already consolidated their loans in the FFEL program.

2. If the borrower is consolidating to obtain either Income-Contingent Repayment (ICR) or Income-Based Repayment because their loan has been submitted to a guaranty agency for default aversion, they may be able to reconsolidate or consolidate again, even if they have previously consolidated.

Other then these two instances, once the borrower has consolidated their student loans, they will not have the ability to consolidate their student loans again.

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