Now you can combine your loans into one monthly payment, extend or shorten your repayment period, adjust your monthly payments, and possibly lower your interest rate. A new publication from the U.S. Department of Education, Federal Direct Consolidation Loan Program , explains how to consolidate your loans under this program. Regardless of the plan you choose, there is no minimum consolidation amount, you can change it at any time and you can repay early without penalty. More than a dozen types of loans are eligible, including Stafford, Ford, PLUS and Guaranteed Student Loans. And if you're married, you and your spouse can combine all of your loan repayments into one monthly amount.
Parents can even consolidate loans for different children.
The interest rate you'll pay is based on adjusted Treasury bill rates that change yearly on July 1. As a student borrower, your interest rate will never exceed 8.25 percent. But keep in mind that the longer you take to repay your loan, the more interest you'll pay in the long run.