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How to Consolidate Navient Student Loans

Michael Lux Consolidation, Student Loan Blog 2 Comments

If you are unhappy with your repayment plan, interest rates, or Navient customer service but unable to pay off your loan, student loan consolidation could be the solution to your problems.Consolidate Navient Student Loans, Student Loan Consolidation

Consolidation is fairly simple. At its most basic level, a new lender pays off your old student loans. Borrowers can consolidate some or all of their loans. Consolidating a single loan is even a possibility. At the end of the consolidation process, your old loans are paid in full and you have to pay off a new loan with newer and hopefully much better terms.

If you are looking to consolidate Navient loans, there are two processes you can go through. Those are federal and private consolidation. Federal consolidation happens through the Department of Education. Private consolidation, usually called student loan refinancing is done with a private lender. There are major differences between the two choices, so you must make an informed decision. Because there is no way to “undo” a consolidation, any mistake you make is permanent.

Federal Direct Consolidation

The huge advantage of federal loan consolidation is that you get to keep all of the perks associated with federal loans. Those perks include income-driven repayment plans and student loan forgiveness. Another advantage of the federal loan consolidation process is that anybody can do it. There are no credit or income requirements.

The downside is that consolidating your federal loans doesn’t lower your interest rate. It just groups your loan together. The goal behind a federal consolidation is to gain eligibility for preferred federal programs.

Another downside is that you can’t pick the federal loan servicer that handles your new consolidated loan. You could end up with Navient again, or you could end up with another company that ends up being worse. The biggest downside is that federal consolidation is not the best strategy for some borrowers. Combining the wrong federal loans could result in borrowers not being eligible for preferred repayment plans. Anyone considering federal direct consolidation should be sure to understand the pros and the cons of the process.

Finally, you can only consolidate federal student loans into a federal loan consolidation. If you are hoping to convert your private loans into federal loans to get on IBR or qualify for student loan forgiveness, you are out of luck. Absent an act of Congress, this financial move is not possible.

Private Consolidation aka Student Loan Refinancing

If you look at the private student loan consolidation companies on the market, you will see a wide selection of lenders and that interest rates can be just over 2%. By slashing your interest rates, you can lower your monthly payments and get your loan paid off faster.

All loans are eligible for private loan consolidation, even federal. If you are thinking of consolidating your federal loans into a private loan, tread carefully.  You can save a bundle by locking in low interest rates, but you must give up the perks that go with federal loans. There is a lot to think about when it comes to private consolidation of federal loans.

If you want to go this route, you will need to have a good credit score and a decent income. The individual requirements and programs vary from company to company, so it pays to shop around.

If you have a great credit score and a high income, companies like SoFi, Laurel Road, and CommonBond all offer rock bottom interest rates. If you can’t lock down the lowest interest rates with those guys, a company like LendKey will match you up with a non-profit credit union and hopefully offer a competitive rate.

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One thing many people forget about credit scores is that shopping around doesn’t hurt your credit report. As a result, it pays to apply at several places to find the best rate. Our full list of student loan reviews should provide a useful starting point in your research and hopefully offer some insight into the other companies out there.

How To Start the Consolidation Process on Navient Loans

Given the enormous differences between private consolidation and federal consolidation, it shouldn’t be much of a surprise that starting each process is dramatically different.

Because the process is identical regardless of loan servicer, Navient borrowers will have the same consolidation process as Sallie Mae, MyFedLoan, and others. Additionally, Navient has no ability or authority to stand in the way of the process.

Consolidation Loan Application Online

Federal Direct Consolidation – The Department of Education handles all federal student loan consolidation requests. Borrowers can start the consolidation process by applying through this portal from the Department of Education. Completing the application usually takes less than half an hour, but it is several weeks or even months before the entire process is complete.

Consolidation with a Private Lender – To refinance with a private lender, a borrower must pass a credit check to get approved. In theory, only one lender is required to complete the process, but we normally recommend shopping around to get the lowest interest rate. This adds a bit of extra time to the process but can result in significant savings. Our student loan refinance company list has links to the various lender application forms.

The Bottom Line

Just because you can’t pay off your Navient loan tomorrow or next week doesn’t mean you are stuck with the same loan and the same terms for years to come. Student loan consolidation offers ways to get lower payments, lower interest rates, and pay off your loan faster.

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A lower interest rate is very tempting, however consolidation muddies the water somewhat. Consolidation, particularly undergrad and graduate loans seems to bury all details.


Ok, this is page describes the ramifications of consolidation; not “how to”. Helpful advice though.