Direct consolidation loans are eligible for federal student loan forgiveness, whether through an income-driven repayment (IDR) plan, Public Service Loan Forgiveness (PSLF), or Teacher Loan Forgiveness ⭕for qualifying teachers. Each of these forgiveness options has certain criteria you’ll need to meet if you want to have your consolidated debt canceled.

What Are Direct Consolidation Loans?

Direct consolidation loans combine—or consolidate—multiple federal student loans into one new loan. 澳洲幸运5官方开奖结果体彩网:Private student loans aren’t eligible for federal consolidation.

Direct consolidation loans are one way to gain access to 澳洲幸运5官方开奖结果体彩网:federal forgiveness options. In fact, if you have any student loans in default—which are ineligible for forgiveness—they can eventually qualify for debt cancellation if you consolidate them. The types of student loans eligible for consolidation include:

• 澳洲幸运5官方开奖结果体彩网:Direct loans (澳洲幸运5官方开奖结果体彩网:subsidized, unsubsidized, and PLUS)
• 澳洲幸运5官方开奖结果体彩网:FFEL loans (subsidized, unsubsidized, non-subsidized, and PLUS)
• 澳洲幸运5官方开奖结果体彩网:Perkins Loans
• Nursing student loans and Nurse Faculty Loans
• Health Education Assistance Loans
• Health Professions Student Loans
• National Direct Student Loans
• National Defense Student Loans
• Loans for Disadvantaged Students
• Auxiliary Loans to Assist Students

Parents who take out 澳洲幸运5官方开奖结果体彩网:direct PLUS loans on behalf of dependent students can’t consolidate these with other federal loans that the student—not the parent—received. Under certain conditions, FFEL consolidation loans and direct consolidation loans can also qualify for further consolidation.

Consolidating may reduce your monthly payment, which can be helpful if you’re struggling to pay down your student debಞt. But you’ll also likely end up making payments for longer than you would if you don’t consolidate.

Eligibility for Forgiveness With Di🌃rect Consolidation Loans 

Income-Driven Repayment (IDR) Plans

There are four basic 澳洲幸运5官方开奖结果体彩网:income-driven repayment (I💙DR) plans. Under each of them, your monthly payments are based on a percentage of your 澳洲幸运5官方开奖结果体彩网:discretionary income. Your remaining balance is forgiven after 20 or 25 years of pa♈yments, depending on your plan. 

• Saving on a Valuable Education (SAVE) plan: Replacing the REPAYE plan, the SAVE plan bases payments on 5% of discretionary income for undergraduates and between 5% to 10% for those with graduate loans. Repayment terms are 20 years for undergraduates and up to 25 years if you have graduate or professional loans. 
• 澳洲幸运5官方开奖结果体彩网:Pay As You Earn (PAYE) plan: Under the PAYE plan, you’ll pay 10% of your discretionary income each month and make payments for 20 years.
• Income-Based Repayment (IBR) plan: Depending on when you first borrowed, your payments will be equal to either 10% or 15% of your discretionary income. Your repayment term will also be between 20 and 25 years.
• Income-Contingent Repayment (ICR) plan: Under this plan, your payments are based on 20% of your discretionary income, and you’ll be in repayment for 25 years.

You’re required to recertify every year to remain eligible for an IDR plan. You 🐬can also make changes throughout the year if your income or family size changes, ensuring your payments accurately reflect your household size and what you can afford to pay.

Depending on what types of loans you have, y♛ou may have to consolidate them into a direct consolidation loan first before you can enroll in an IDR plan.

Currently, direct consolidation loans are only eligible for the SAVE and IBR plans, as the PAYE and ICR aren’t accepting new enrollments. However, if a direct consolidation loan was used to repay any parent PLUS loans, then it’s eligible for the ICR plan (and only that plan).

Public Service Loan Forgiveness (PSLF)

If you work full-time for the government or a nonprofit organization with a qualifying employer, you might be eligible for 澳洲幸运5官方开奖结果体彩网:Public Service Loan Forgiveness (PSLF🥂🧜). This program will require you to make 120 qualifying payments under an accepted repayment plan, after which any remaining balance on your loans is forgiven. All direct loans are eligible for PSLF. Qualifying repayment plans include:

• The 10-year 澳洲幸运5官方开奖结果体彩网:standard repayment plan
• The SAVE plan
• The PAYE plan
• The IBR plan
• The ICR plan

Teacher Loan Forgiveness

Teachers who have taught full-time for at least five consecutive years in a low-income school might qualify for forgiveness of up to $17,500 on direct loans, which can include direct consolidation loans.

Subsidized direct loans, unsubsidized direct loans, subsidized federal 澳洲幸运5官方开奖结果体彩网:Stafford loans, and unsubsidized federal Stafford loans are all eligible for 澳洲幸运5官方开奖结果体彩网:Teacher Loan Forgiveness. Reachers with direct consolidation loans only qualify for forgiveness of whatever outstanding portions of the consolidation loans were used to repay any of the aforementioned direct and federal Stafford loan types.

The Bottom Line

Direct consolidation loans have a few different avenues for federal student debt forgiveness, including IDR plans, PSLF, or Teacher Loan Forgiveness. If you’re hoping to get a direct consolidation loan forgiven, then the 💫right option for you will depend on your financiꦿal situation, career, and what you can qualify for.