Debt Basics
Ready to consolidate your student loans? Here’s how
Mar 16, 2025
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Key takeaways:
You can often get a more affordable payment if you consolidate student loans.
Student loan consolidation is for federal student loans, while student loan refinancing is for private student loans.
Student loan consolidation and refinancing are usually easy to accomplish.
Managing your money isn’t just about paying your bills. It’s that, yes. But it’s also about creating a financial plan that works for you and supports your dreams. When you organize your finances today, you create peace of mind for tomorrow.
Switching things up with a debt consolidation loan could be a great way to align your finances with your wallet and your goals. If you’ve decided that student loan debt consolidation is the right path for you, here are some tips for getting it done.
Student loan consolidation
If you have student debt, chances are some or all of it comes in the form of federal student loans. These loans are issued by the federal government and come with a whole suite of benefits.
For example, you could combine all your individual federal student loans from each semester into a single new debt with a federal Direct Consolidation loan. It’s a formal process that’s only available for your federal student loans.
Student loan refinancing
Fewer than 10% of student loans are private loans offered by individual lenders. If you qualify with a lender, you could combine your federal and private student loans together into a new private loan. Depending on the lender and your creditworthiness, you might get a more affordable payment and/or save money on financing costs over the long run.
Federal student loans.. | Private student loans… | Any student loans… |
|---|---|---|
Can be consolidated into other federal student loans | Can be refinanced into other private student loans | Can be refinanced into private student loans |
Pro tip: If you have private student loans and want to consolidate, seek out a lender that specializes in student loan refinance.
How do you consolidate federal student loans?
The federal government makes it easy to consolidate your federal student loans. You can usually finish the application process in 30 minutes or less.
1. Log into your federal student loan account
You can access a consolidation loan application directly in your Department of Education account.
2. Fill out the online form
You’ll need to fill out basic information about your finances. You’ll also get the option of choosing a new student loan servicer (the company that handles your payment details) and student loan repayment plan.
3. Wait for the consolidation loan
It can take up to six weeks to process your consolidation loan application, so keep making your loan payments until you receive confirmation that your new loan is in place. Your new due date will begin within 60 days from this point, and your new loan servicer should be in touch with the exact details.
How do you consolidate private student loans?
Private student loan consolidation (i.e., “refinancing”) can vary a bit more since each individual lender is different. That can affect your potential loan choices, so you’ll have a few more decisions to make. Here are the steps to consolidate your private student loans:
1. Gather loan details
You’ll be comparing different loan options, so it’s a smart idea to get all of this information in advance. Here’s what to note for each of your current student loans:
Interest rate
Remaining balance
Remaining term length
2. Shop for loan options
You can give your future self a big helping hand by shopping for different student loan refinance options. It’s usually a quick and easy process to check your options online with most student loan refinancing companies.
Pay close attention to the fees, rates, and term lengths they offer you since those will affect your monthly payment and the overall cost of your new loan. It’s also a good idea to look up lender reviews. For private lenders, ask about any payment relief options they provide in case you run into financial snags in the future.
3. Complete a loan refinancing application
Pick your favorite lender and complete a full refinancing application. This usually means you’ll need to add more financial details or documents. You might be able to speed up the application process by responding quickly to them if they ask for any more information.
4. Receive your new student loan
If you’re approved, your new lender will generally reach out to your old lenders to transfer your student loan debt directly. It’s important to keep paying your old student loans, though, until you hear from both lenders that the process is complete. That way you won’t miss any payments.
What’s next
Check your credit report to make sure it’s correct. You can dispute credit report errors if you find any.
Use a student loan consolidation calculator to figure out what benefit you might get by consolidating your loans.
Consider other types of debt consolidation loans, which could also help you streamline your finances.
Written by
Lindsay is a writer for Achieve. She's passionate about helping people learn how to manage their money better so that they can live the life they want. She enjoys outdoor adventures, reading, and learning new languages and hobbies.
Reviewed by
Jill is a personal finance editor at Achieve. For more than 10 years, she has been writing and editing helpful content on everything that touches a person’s finances, from Medicare to retirement plan rollovers to creating a spending budget.
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