How to Consolidate Your FFEL Loans to Qualify for Biden’s Forgiveness

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  • Some FFEL loans are federally sponsored student loans held by private student loan providers, and others are held by the US government.
  • Private FFEL loans are out of the question for Biden’s forgiveness plan. You must consolidate into a direct loan to qualify.
  • Here’s how to apply for direct loan consolidation and the pros and cons involved.

You could miss out on a student loan forgiveness just because you have the wrong type of loan.

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President Biden’s $10,000 and $20,000 forgiveness plan for Pell Grant recipients applies only to federally owned student loans. And some FFEL loans are currently ineligible.

Student loan expert Sonia Lewis of the Student Loan Doctor explains, “FFEL loans are government-backed loans funded by a private company.”

Because some FFEL loans are serviced by private lenders, they are not eligible for student loan forgiveness and other government protections such as the pandemic payment pause. The Biden administration says it is working to bring forgiveness to people with privately held FFEL loans, but there is no specific timeline or information at this time.

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However, some FFEL loans are already held by the US government through service providers such as Nelnet or MOHELA. These loans already qualify for student loan forgiveness; If your FFEL loans were on hold during the pandemic, they are eligible for forgiveness.

If your FFEL loans are privately owned, you must consolidate them into direct loans owned by the government to qualify for forgiveness. Here’s how to do it.

How to complete a direct loan consolidation application

The first step is to fill out a direct loan consolidation application at You must log in to start the application, but you can also use a read-only or demo application to prepare for the actual application.

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You must provide the following:

  • Your full name and all previous names
  • your social security number
  • Your date of birth
  • your permanent address
  • Your phone number
  • Your e-mail address
  • Your employer’s name, address and telephone number

You must also provide two references – two adults who live in the US but do not live with you and who have known you for at least three years. You must provide the following information about your references:

  • phone number
  • Email-address
  • mailing address

After you have filled out your information and provided references, the next section in the application is titled Loans I want to consolidate. This is what this part of the application looks like:

A screenshot of the sample online application for direct consolidation from

This is the part of the Direct Consolidation application where you select which loans you want to consolidate.

Only consolidate non-direct loans.

Once you’re done with this section, fill out the next section titled Loans I don’t want to consolidate. They will list any other student loans that you want the federal government to consider when determining your maximum repayment period.

Choose your new service provider

After selecting the loans you want to consolidate and those you don’t want to consolidate, you will be prompted to select a new government student loan servicer.

Here is a list of federal loan servicers and details on each one from the Better Business Bureau:

Sign a new promissory note

Just like you did when you went to college, you must sign a promissory note, an agreement between you and the government that says you will pay your debt. Lewis says, “Basically, you’re taking out a new loan with this government, so you should think of it as such.”

Your direct consolidation application includes a hard credit request, which means your credit score could drop by five to 30 points, Lewis says.

What are the benefits of consolidating my FFEL loans?

If you consolidate your FFEL loans, you’re eligible for Biden’s $10,000 student loan forgiveness plan, or $20,000 if you received a Pell grant (provided you meet the income threshold of $125,000 per year for an individual or $250,000 for married couples who apply for taxes together).

In addition, you may be entitled to lower monthly payments. FFEL loans, which were discontinued in 2010, are only eligible for select federal income-tested repayment plans. Consolidating into a direct loan entitles you to more IDR options.

What do I lose by consolidating my FFEL student loans?

If you paid off your FFEL loan using an income-tested repayment plan, if you consolidate now, any payments you made for forgiveness will be erased. You would have to start the clock all over again as soon as you consolidate your student loans.

The same normally applies to government loan forgiveness, although your payments are covered under the temporary PSLF waiver until the end of October.

Here’s how long it takes for federal student loans to be granted under certain IDR plans:

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