Can I Consolidate Student Loans While Still in School?

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Many college students may wonder if there’s a way to possibly consolidate their debt while they are still students in school. Is this financing option available to current students before they graduate?

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What Does It Mean To Consolidate Loans?

If you have student loan debt but are unable to refinance your loans, you may choose to consolidate your loans. Consolidation combines all of your loans into one loan at a new interest rate. This rate is the weighted average of your previous loans, allowing borrowers to simplify their cash flow and payment process. 

Before consolidating loans, however, check to see which types of student loans are eligible for consolidation. Private loans may not be consolidated. Federal loans can be consolidated, but some borrowers choose to consolidate through the federal government in order to keep their federal loan benefits. If you are unsure which is the best approach for your federal student loans, to consolidate or not, reach out to a financial advisor for additional guidance.

Can You Consolidate Student Loans While You’re in School?

The short answer to this question is no. Meagan McGuire, a consultant at Student Loan Planner, said you cannot consolidate loans while you’re in in-school deferment per the rules of studentaid.gov. 

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“You could consolidate loans from an older degree as long as those loans are not in in-school deferment, but you cannot consolidate loans for a current degree you’re pursuing,” McGuire said.

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Can You Refinance Loans While You’re in School?

Another popular financing option for student loans is to refinance the debt. However, McGuire said this is also not an option for current students. 

Why not? Usually, it’s because a current student doesn’t meet the lender’s refinancing requirements. Unless you’ve graduated, McGuire said refinancing companies want to see you have an income and are less than half-time enrolled in school. Generally speaking, having an income tends to happen after graduating with your degree!

When Can You Consolidate Your Loans?

The best time to consolidate student loans, or look into other financing options for debt, is after graduation. Dave Schiller, founder and managing partner at Aegis Wealth Partners, LLC, said borrowers can look into consolidation for loans any time after graduation. This includes during their six-month initial grace period. 

“You can consolidate federal loans to make a single loan if that is simpler for the borrower, but if the borrower wants to see if they can lower their monthly payments from the standard 10-year repayment plan they would need to consolidate eligible loans first, then select an income-driven payment plan,” Schiller said.

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About the Author

Heather Taylor is a senior finance writer for GOBankingRates. She is also the head writer and brand mascot enthusiast for PopIcon, Advertising Week’s blog dedicated to brand mascots. She has been published on HelloGiggles, Business Insider, The Story Exchange, Brit + Co, Thrive Global, and more media outlets. 

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