How Many Times Can You Consolidate Student Loans?

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Stanley tate

Student Loan Lawyer

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There are a handful of times where you can consolidate your student loans a second time.

Federal loans: student loan consolidation lets you combine multiple federal student loans into a new loan. It also lets you keep the borrower protections and repayment options than loans from the U.S. Department of Education receive. The new loan won't reduce your interest rate. But it allows you to qualify for loan forgiveness programs and different repayment plans and choose a new loan servicer.

Private loans: the consolidation process is called refinancing. The refinancing process is done through a private lender. Unlike federal consolidation, private student loan refinancing can lower your interest rate. It also lets you change your loan term. However, when you refinance federal education loans with a private lender, you need a good credit score, a cosigner, or both. Plus, you lose access to federal benefits like student loan repayment plans based on your income.

Here's what you need about consolidating your student loan debt more than once.

Consolidating federal student loans twice

You can consolidate your federal loans more than once if:

  • You have another federal student loan to include with the consolidation loan.
  • You have a consolidation loan made under the Federal Family Education Loan Program (FFELP).

Consolidating a loan a second time gives you a new Direct Consolidation Loan with new repayment terms. It also resets any qualifying payments you've earned towards Public Service Loan Forgiveness or income-driven repayment plan forgiveness.

However, if you have a FFEL Consolidation Loan, merging it into the Direct Loan Program does three things:

  • gets you out of default
  • qualifies you for the PSLF Program
  • makes you eligible for better repayment plans (e.g., REPAYE)

Consider other student loan repayment options if you can't consolidate a second time but need to get out of default or a lower payment. You also can contact your loan servicer to find out if you're eligible for deferment, forbearance, or other options to lower your student loan payments.

Note: You cannot consolidate a spousal consolidation loan more than once. If you need to get you or your ex-spouse off the loan, look into refinancing with a private lender.

Can you refinance a consolidated student loan?

You can refinance a consolidated student loan with a private lender to get a lower fixed interest rate. There's no limit to the number of times you can do this. So long as you qualify, you can keep refinancing to get the best terms to repay your student loan debt.

While eligibility varies from lender to lender, to qualify for student loan refinancing, you'll typically need:

  • a blemish-free credit report
  • a credit score in the high 600s
  • steady income

Basically, you need to show your lender you can afford to make the student loan payments while covering living expenses.

Before you refinance student loans from the government, remember that you'll lose access to loan forgiveness, discharge due to disability, and income-based payments.

Refinancing student loans more than once

You can refinance a private student loan you've previously refinanced. Savvy student loan borrowers do this to take advantage of competitive variable rate loans.

The one drawback to refinancing a second time is the added cost of refinancing. Many private lenders charge an origination fee, which is usually a set amount or a percentage of the loan balance. You can find this fee in the loan application.

Benefits of a second consolidation

The main benefits of consolidating a federal loan twice are:

  • Extended repayment periods: If you need lower monthly payments to balance your budget, consolidating will extend the life of your loan. The longer repayment period will reduce the size of your monthly payments under the Standard, Extended, and Graduated Repayment Plans.
  • One convenient monthly payment: Consolidating allows you to combine all federal loans into a single loan. This can be especially helpful for borrowers with different servicers or different loan types (e.g., Direct Loans, FFEL Loans, Perkins Loans, etc.). However, be careful about combining Parent PLUS Loans with other non-PLUS Loans. Doing so will make you ineligible for most income-driven repayment plans other than income-contingent repayment.
  • Qualify for new benefits: In some cases, a second consolidation may help you qualify for an income-driven repayment plan and other forgiveness options. Over the years, I've seen many teachers, professors, and other public servants need to consolidate a second time to get a federal Direct Loan that qualifies for PSLF.

Drawbacks of a second consolidation

Consolidating a second time isn't without consequence. Some drawbacks to consider are:

  • Roughly the same interest rate: The interest rate on your new loan will be the weighted average of the loans you consolidate. So while you might be able to qualify for a lower interest rate if you refinance to a private loan, consolidation doesn't come with the same potential benefit.
  • Pay more interest: Taking longer to pay will increase the total amount of interest that accrues over the life of the loan.
  • Loss of qualifying credit: When you consolidate a second time, you lose any credit you've earned towards loan forgiveness and cancellation. Your new loan will start fresh with the payments you'll need to make before your loans can be forgiven.

How to consolidate a second time

You can consolidate your loan a second time for free at the Federal Student Aid website, studentaid.gov.

​You'll need an FSA ID to access the website.

You can create that ID using your:

  • Social Security Number
  • Date of Birth
  • Email address

If you have trouble logging in, contact the Federal Student Aid Information Center at 800-433-3243.

Thinking about consolidating a second time? Let's talk.

If you're considering consolidating again to stop a garnishment, qualify for PSLF, or lower your payments, I can help you make the decision for you.

Schedule a free 10-minute call with me today. We'll go over all of your options to put you in the best financial position moving forward.

Also, sign up for my newsletter, full of information to help any student loan borrower out there. Talk soon!

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I'm a student loan lawyer that helps people like you with their federal and private student loans wherever they live.

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