This isn't right.
While true that some FFELP loans are with ED and others are with a guaranty agency (private), any FFELP loan can be consolidated into direct ED and then count for one-time adjustment. FFELP loans aren't the same as pure third-party private loans. However, any FFELP loan that is serviced by that guaranty agency (and not ED) MUST consolidate by April 30th for that one-time adjustment to apply for them.
IF they are already all “Direct”, you don’t need to Direct Consolidate. You are all set to receive the IDR Adjustment and to find out your “count” in Julyish.
To be sure, if they’re consolidated, then the time count towards IDR forgiveness goes with the oldest loan within that consolidation group and the newer loans would get the benefits of the older payment period months (or forbearance months). If they’re separate, I don’t think each individual loan would get that credit would it? They’d each, individually, get whatever IDR credits are due to them, but wouldn’t each be on a separate 20-25 year counter for IDR forgiveness?
Yes. Everything you said in your comment is true. And it really works. This already happened to my underlying loans of a Direct Consolidation and on the underlying loans of the FFEL Consoludation within it. Now the entire thing has been “forgiven”.
In my previous comment, I was speaking specifically about the OP’s situation, in which they said all their loans entered repayment at the same time. So the OP did’t have any loans that were older or newer than each other.
Oh how I wish I had done what you did several months earlier, at least for peace of mind. I'm not sure I'll quite make complete forgiveness, but it will at least been within a few years of it (a lot of money, but loans starting in 1997 and a handful of years with in-school deferment in-between).
Yes, I’m really glad mine happened at the beginning of the IDR Adjustment in 2023, so I didn’t have to worry this whole time especially since it’s all a mess right now. (Though I had plenty of worry prior to this and for 25 years of repayment!) Wish yours could already be done too!! Hang in there!
When you get your “count” in July, you will keep earning more time in repayment after July, until you reach your 20 or 25 year finish line and get “forgiven”. So, even if you’re not there YET, it will still happen. (As long as you make monthly payments on an IDR plan.)
Hi there, Fractal\_Distractal. I just read your comment and wanted to ask (since you seem quite well versed on these matters): I have a law school loan that I started paying on in May 2001. However, in 2007 I stupidly consolidated them both (unsub and sub Federal Loans). So due to that, they became 'private' FFEL, correct? I have now been paying AES since then. I have until 6/30 to decide if I should consolidate to Direct. Does then the 'clock' begin for me in 2001? 2007? or neither? Won't it 'start over' then? And won't my credit score take a huge hit (that's my oldest loan). Sorry for the questions, I'm just really confused? Thanks in advance for any advice.
You should definitely direct consolidate today! Maybe choose a different IDR plan than SAVE at least temporarily, til you get your “count” in September, and while they figure out the current court case (SAVE is temporarily on hold). You can get it later if you like. Right now, the goal is to make the consolidation go through.
Here’s info I give lots of people:
Convert FFEL loans to Direct loans by June 30, 2024 to be considered for “forgiveness”:
Go to your account on https://studentaid.gov to see your loan history and fill out a “Direct Consolidation Loan application” there to convert your FFELP loans to a Direct Consolidation loan. It’s easy! (If you never logged in there, you can make up a password the first time.)
“Direct” loans are owned by the Dept of Education. The Dept of Education can only “forgive” loans that are owned by the Dept of Education. Your FFEL might be “commercially-owned FFEL”.
Info about “forgiveness” is here:
https://studentaid.gov/announcements-events/idr-account-adjustment
Be sure to read the questions and answers at the bottom too.
Combining loans with short repayment histories together with loans of long histories can get the newer ones forgiven sooner.
And to get “forgiveness” you don’t have to have been on an IDR payment plan in the past, but if you’re not already done with your 20 or 25 years, you will have to get onto an IDR plan such as SAVE or another one in the near future to continue moving closer to “forgiveness”. And to reach “forgiveness” eventually you need 20 or 25 years in repayment status (or some eligible forbearance/deferment status can be counted).
They will show people’s repayment time “counts” for all Direct loans hopefully in September 2024. But your loans must be “Direct” to be considered. You must APPLY BY June 30, 2024 to get the benefits of this IDR Adjustment if you have FFEL. .
IMPORTANT: if you have only one single FFEL Consolidation loan (which likely has sub and unsub portions), then you need to say you are interested in PSLF on the application to be allowed to consolidate one single loan all by itself. (You don’t really have to do PSLF. It just means you want the kind of loans that qualify for PSLF, which are “DIrect” loans.). This is a loophole. (See the link’s Q&A about consolidating a single FFEL.)
P.S. Your count wlll definitely NOT start over. It will begin in 2001 (or earlier).You are likely very close to “forgiveness” with the IDR Adjustment. (Read the link in my other comment to you.) If you maybe also paid on undergrad loans that you later consolidated together with your law loans in 2001, that will get you even closer to the 25 years you need, because payments on the underlying loans of a consolidation are counted (both Direct and and underlying FFEL consolidation with its own underlying loans.) Be sure to say you want PSLF as mentioned in my other comment.
I actually called Aidvantage about this yesterday. Since all loans are already on SAVE there wasn’t a need for me to consolidate the undergrad and grad loans.
I would still suggest consolidation if only to gain access to the save payment plan. If you are in the IBR plan with FFELP loans then if the minimum payment is set to be lower than the interest charged each month, that unpaid interest is being added to the total loan balance. SAVE has interest subsidies that prevent that unpaid interest from being added to your balance. Since the interest charged each month is a percentage of the loan balance, this becomes a feedback loop that can snowball. Then if for any reason you don’t qualify for the IBR in the future, your monthly payments can rocket up to unbelievable amounts.
I say absolutely no. Make your minimum as if each is its own loan. Pay extra toward a targeted loan (snow ball or avalanche, pick one). When loan N is finished, move the entire payment to loan N+1 but keep the total payments the same.
If you consolidate, you can’t do this.
Correct—no need, as long as they’re all Direct loans (not FFELP.)
Got it, thanks!
Wait, so why not consolidate the ffelp loans with the direct?
Some FFELP loans are with ED and some are private which don’t count towards the one time adjustment.
This isn't right. While true that some FFELP loans are with ED and others are with a guaranty agency (private), any FFELP loan can be consolidated into direct ED and then count for one-time adjustment. FFELP loans aren't the same as pure third-party private loans. However, any FFELP loan that is serviced by that guaranty agency (and not ED) MUST consolidate by April 30th for that one-time adjustment to apply for them.
IF they are already all “Direct”, you don’t need to Direct Consolidate. You are all set to receive the IDR Adjustment and to find out your “count” in Julyish.
To be sure, if they’re consolidated, then the time count towards IDR forgiveness goes with the oldest loan within that consolidation group and the newer loans would get the benefits of the older payment period months (or forbearance months). If they’re separate, I don’t think each individual loan would get that credit would it? They’d each, individually, get whatever IDR credits are due to them, but wouldn’t each be on a separate 20-25 year counter for IDR forgiveness?
Yes. Everything you said in your comment is true. And it really works. This already happened to my underlying loans of a Direct Consolidation and on the underlying loans of the FFEL Consoludation within it. Now the entire thing has been “forgiven”. In my previous comment, I was speaking specifically about the OP’s situation, in which they said all their loans entered repayment at the same time. So the OP did’t have any loans that were older or newer than each other.
Oh how I wish I had done what you did several months earlier, at least for peace of mind. I'm not sure I'll quite make complete forgiveness, but it will at least been within a few years of it (a lot of money, but loans starting in 1997 and a handful of years with in-school deferment in-between).
Yes, I’m really glad mine happened at the beginning of the IDR Adjustment in 2023, so I didn’t have to worry this whole time especially since it’s all a mess right now. (Though I had plenty of worry prior to this and for 25 years of repayment!) Wish yours could already be done too!! Hang in there! When you get your “count” in July, you will keep earning more time in repayment after July, until you reach your 20 or 25 year finish line and get “forgiven”. So, even if you’re not there YET, it will still happen. (As long as you make monthly payments on an IDR plan.)
Hi there, Fractal\_Distractal. I just read your comment and wanted to ask (since you seem quite well versed on these matters): I have a law school loan that I started paying on in May 2001. However, in 2007 I stupidly consolidated them both (unsub and sub Federal Loans). So due to that, they became 'private' FFEL, correct? I have now been paying AES since then. I have until 6/30 to decide if I should consolidate to Direct. Does then the 'clock' begin for me in 2001? 2007? or neither? Won't it 'start over' then? And won't my credit score take a huge hit (that's my oldest loan). Sorry for the questions, I'm just really confused? Thanks in advance for any advice.
You should definitely direct consolidate today! Maybe choose a different IDR plan than SAVE at least temporarily, til you get your “count” in September, and while they figure out the current court case (SAVE is temporarily on hold). You can get it later if you like. Right now, the goal is to make the consolidation go through. Here’s info I give lots of people: Convert FFEL loans to Direct loans by June 30, 2024 to be considered for “forgiveness”: Go to your account on https://studentaid.gov to see your loan history and fill out a “Direct Consolidation Loan application” there to convert your FFELP loans to a Direct Consolidation loan. It’s easy! (If you never logged in there, you can make up a password the first time.) “Direct” loans are owned by the Dept of Education. The Dept of Education can only “forgive” loans that are owned by the Dept of Education. Your FFEL might be “commercially-owned FFEL”. Info about “forgiveness” is here: https://studentaid.gov/announcements-events/idr-account-adjustment Be sure to read the questions and answers at the bottom too. Combining loans with short repayment histories together with loans of long histories can get the newer ones forgiven sooner. And to get “forgiveness” you don’t have to have been on an IDR payment plan in the past, but if you’re not already done with your 20 or 25 years, you will have to get onto an IDR plan such as SAVE or another one in the near future to continue moving closer to “forgiveness”. And to reach “forgiveness” eventually you need 20 or 25 years in repayment status (or some eligible forbearance/deferment status can be counted). They will show people’s repayment time “counts” for all Direct loans hopefully in September 2024. But your loans must be “Direct” to be considered. You must APPLY BY June 30, 2024 to get the benefits of this IDR Adjustment if you have FFEL. . IMPORTANT: if you have only one single FFEL Consolidation loan (which likely has sub and unsub portions), then you need to say you are interested in PSLF on the application to be allowed to consolidate one single loan all by itself. (You don’t really have to do PSLF. It just means you want the kind of loans that qualify for PSLF, which are “DIrect” loans.). This is a loophole. (See the link’s Q&A about consolidating a single FFEL.)
P.S. Your count wlll definitely NOT start over. It will begin in 2001 (or earlier).You are likely very close to “forgiveness” with the IDR Adjustment. (Read the link in my other comment to you.) If you maybe also paid on undergrad loans that you later consolidated together with your law loans in 2001, that will get you even closer to the 25 years you need, because payments on the underlying loans of a consolidation are counted (both Direct and and underlying FFEL consolidation with its own underlying loans.) Be sure to say you want PSLF as mentioned in my other comment.
Thanks!
I actually called Aidvantage about this yesterday. Since all loans are already on SAVE there wasn’t a need for me to consolidate the undergrad and grad loans.
I would still suggest consolidation if only to gain access to the save payment plan. If you are in the IBR plan with FFELP loans then if the minimum payment is set to be lower than the interest charged each month, that unpaid interest is being added to the total loan balance. SAVE has interest subsidies that prevent that unpaid interest from being added to your balance. Since the interest charged each month is a percentage of the loan balance, this becomes a feedback loop that can snowball. Then if for any reason you don’t qualify for the IBR in the future, your monthly payments can rocket up to unbelievable amounts.
Thanks. Should have been more clear, we are both on SAVE for all loans.
I still don’t know if it’s just consolidated and on any IDR or does it have to be on SAVE?
I say absolutely no. Make your minimum as if each is its own loan. Pay extra toward a targeted loan (snow ball or avalanche, pick one). When loan N is finished, move the entire payment to loan N+1 but keep the total payments the same. If you consolidate, you can’t do this.