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New Grad Student Loan Questions and Answers: Consolidation

Here are some questions about consolidation using a Federal Direct Consolidation Loan that we tackled live during the 2019 New Veterinary Graduate Student Loan Repayment Webinar.

“How do we know if our student loans are able to be consolidated?”


To receive a Direct Consolidation Loan, you must include at least one Direct or Federal Family Education Loans (FFEL) program loan in the consolidation*.


Your Direct and/or FFEL program loans need only be in their grace period, deferment, or repayment in order to include them in a Federal Direct Consolidation Loan.


Your Direct Unsubsidized veterinary school loans should enter their grace period shortly after your last semester ends or after graduation. I wish I knew the rhyme or reason for each school’s timing on the loan status switch, but it’s highly variable. Some schools switch over quickly and some even a few days before graduation.  Others can take a few weeks or even a month to reflect your graduation status.


The NSLDS is usually updated at least monthly, so you might see your status update with the change of the month following your graduation. You might even call your school financial aid office after graduation to see when they might report your graduation status to the Department of Education.  Sometimes that request can nudge your school into updating your status or reporting your status change earlier.


*Special Note: If you were to only have Perkins, Health Professions Student Loans, or Loans for Disadvantaged Students, you would be able to utilize a Direct Consolidation Loan.  I regularly meet a handful of veterinary students who fall into this category — the good news is that your loan balances in those cases are relatively low and have not been costing you interest during school so you’re in great shape to pay those back without having to consolidate.

“Can you consolidate after the grace period?”


Yes.  But, the timing of your Federal Direct Consolidation is important.


Your Direct Loans and/or Federal Family Education Loans (FFEL) need only be in their grace period, deferment, or repayment in order to include them in a Federal Direct Consolidation Loan.  


There are a couple of issues with waiting until your veterinary school loan grace period expires to start the Direct Consolidation Loan:


1. You continue to accrue interest on all of your unsubsidized loans during the grace period.  Thus, when you do enter repayment or consolidate later, the increased unpaid interest balance will be added to your principal resulting in a higher starting repayment balance.  You are charged interest on your principal — the higher your principal, the more you’ll pay during repayment.


2. The Direct Consolidation Loan takes 30-60 days to process.  Once processed your first payment will be due 30 days after that. If you wait until after your grace period, there is nearly 9 months of time that you are not in repayment, thus not making qualifying payments towards forgiveness.  Better to get the clock ticking, especially if you anticipate having a balance forgiven under an income-driven repayment plan.

“Can you consolidate and waive your grace period if you’re planning to do Public Service Loan Forgiveness (PSLF)?”


You can and you should, especially if you’re starting a PSLF qualifying employment soon after graduation.


In order to make qualifying PSLF payments, you have to be 1) in repayment using an income-driven repayment plan, 2) paying federal Direct Loans on-time, and 3) employed full-time (average of 30 hours per week) with a qualifying employer. 


The sooner you can get most or all of your federal student loans consolidated into a Direct Consolidation Loan, the sooner you can officially start making payments using an income-driven repayment plan, which are 2 of the 3 primary requirements for working towards PSLF.  And if you can get the $0/mo payment due for the first 12 months of repayment, you’ll have more of your loans forgiven when you reach PSLF.


Per the PSLF Employment Certification Form, “A qualifying employer includes the government, a not-for-profit organization that is tax-exempt under Section 501(c)(3) of the Internal Revenue Code, or a private not-for-profit organization that provides certain public services. Serving in an AmeriCorps or Peace Corps position is also qualifying employment.”


I would recommend bringing a PSLF Employment Certification Form to your employer after you’ve started working with them and made a few monthly payments towards your student loans.  Repeat that process each year so you have 9 or 10 of those certification forms to submit with your actual application for PSLF.


After you’ve made 120 of those qualifying PSLF payments, you should have an easier time (in theory) having your remaining student loan balance forgiven tax-free if you have all of your employment certification forms documenting your progress along the way.

“My Perkins Loans, Health Professions Student Loan, and Loans for Disadvantaged Students aren’t listed as eligible under income-driven repayment. Can I consolidate them in order to pay them using PAYE, REPAYE or IBR?”


Yes, you can consolidate those non-Direct loan types as long as you are including one Direct or FFEL program loan in the consolidation. That is one of the primary reasons to utilize a federal Direct Consolidation Loan — to include non-Direct federal student loan types that do not qualify for income-driven repayment (IDR) on their own, but will once you consolidate them.


The most beneficial income-driven repayment plans (PAYE, REPAYE, IBR) and Public Service Loan Forgiveness (PSLF) can only be used with Federal Direct Loans. The only way to make federal non-Direct Loan types qualify for IDR and PSLF is through a Direct Consolidation Loan and the best time to consolidate your loans is as soon as you can after you graduate veterinary school.

“Can you do Federal Direct Consolidation once you have started payments on an income-driven repayment plan?”


You can.  However, if you are already in repayment, you should be extremely careful using a Direct Consolidation Loan.  This is why the timing of your Federal Direct Consolidation Loan is so important.


When you consolidate, you receive a new loan(s) that pays off all of the loans included in the consolidation.  If you have made qualifying income-driven payments or PSLF payments to loans that you consolidate, you will lose credit for those qualifying payments.  Essentially, you reset your forgiveness clock on any loan you consolidate. That is another reason to start the Direct Consolidation Loan process as early as possible, ideally right after you graduate veterinary school.

“Should I consolidate my spouse’s federal student loans with mine?”


You can no longer combine federal student loans with your spouse as part of a federal consolidation loan.  That is likely a good thing because it is a mess to deal with in the event of separation/divorce.


You could probably still do a consolidation with your spouse using a private loan, but for many other reasons in addition to the fact it would still be a mess in the event of separation/divorce, I would highly discourage consolidating your student loans with your spouse’s student loans.

Have more questions? Post a comment below or email studentdebt@VINFoundation.org.

VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | 2019 New Veterinary Graduate Student Loan Playbook

Repay Wiser: 2019 New Veterinary Graduate Student Loan Playbook

Graduate, Consolidate, Get Started in Income-Driven Repayment


Congratulations, new veterinary doctors! It’s time to celebrate graduation! It’s also time to log in to NSLDS.ED.GOV, download your NSLDS file, use the VIN Foundation My Student Loans tool and Student Loan Repayment Simulator, and start a Federal Direct Consolidation Loan as soon as you can to save you time and money.


On Wednesday, May 29, 2019, VIN & VIN Foundation hosted a live webinar with Tony Bartels, DVM, MBA, to discuss why starting your student loan repayment plan ASAP is so beneficial and how to do it.  If you were unable to attend, no worries — we have the information for you to review right here!


VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | Veterinary School Student loan Interest Rates for 2019-20 Academic Year Decreasing

Lower Student Loan Interest Rates for 2019

Rarely do we get good news when it comes to student debt. But interest rates for the federal student loans you borrow for the 2019-20 veterinary school academic will be lower than last year.

Interest rates are updated each year using the high yield of the May U.S. 10-year treasury note.  The high yield plus a factor for your Direct loan and school type sets the fixed rate you pay for the life of those loans received between this July 1st and next June 30th. As a veterinary student, the graduate/professional school Direct Unsubsidized loan interest rate will be 6.08%, down from 6.6% this past year. The Direct Graduate Plus loan rate will be 7.08%, down from 7.6% this past year.


VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Solutions for the Profession Competition | veterinary essay competition | 3rd Annual Essay Competition 2019 winners

3rd Annual Solutions for the Profession Competition Winners

Third annual essay competition provides veterinary students an opportunity to offer insight into practice consolidation and its impact on the profession


Davis, CA: The VIN Foundation is excited to announce the results of its third annual Solutions for the Profession Competition. Three winners were awarded cash prizes to help with educational expenses.


VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | Student Loan Forgiveness: Taxable or Tax-Free? Either way, It’s a Blessing

Student Loan Forgiveness: Taxable or Tax-Free?

Paying back a veterinary school student debt load can be extremely stressful and confusing.  Analyzing the various federal repayment options and programs and choosing the best for your situation is challenging.  Spending nearly the last ten years helping to educate veterinary students, veterinarians, and those who work with them navigate their student loans and repayment options, I’ve seen student loan forgiveness cause significant confusion.


Public Service Loan Forgiveness:


VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | Top 5 Mistakes Made by Veterinarians Using Income-driven Repayment

Top 5 Mistakes Made by Veterinarians Using Income-driven Repayment

The below piece was originally published as a guest post on Financial Wellness DVM



Repaying student loans is stressful and complicated.  For recent graduate veterinarians, high student loan balances coupled with starting salaries lower than their student debt total are the norm.  Depending on the school you attended or the practice type and region where you’re working, your student debt to income ratio is often two or greater.  Once your student debt to income ratio gets above one, traditional repayment plans and strategies are financially risky, inflexible, and often more costly.


VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | In-School Loan Estimator expands VIN Foundation Student Debt Part 2

Veterinary Student Debt Questions and Answers Part 2

VIN Foundation partnered with Under the Microscope to bring you a free follow up webinar: Veterinary Student Debt Questions and Answers Part 2


In Part 1 we covered the basics and answered questions. For Part 2 we talked through actual cases. Feel free to add your questions, comments, experiences, and suggestions to add to the conversation by commenting below or emailing us


Case 1: High Student Debt Scenario

  • Which plan should I use?
  • How much do I pay?
  • How do I plan for forgiveness?


Case 2: Low Student Debt Scenario

  • I didn’t borrow that much – What if I don’t need income-driven repayment?
  • When do I pay more? And How much more do I pay?
  • Should I or When do I refinance?


Case 3: Married Student Debt Scenario

  • Double Vet, Double Debt
  • One vet, spouse with no debt
  • Community property states

Tony Bartels, DVM, MBA joined Carl Darby, MA, VETMB for a discussion on your veterinary student debt questions and answers. Presented by VIN Foundation, VIN and Under the Microscope.


After working with thousands of veterinary students and veterinarians in repayment for the better part of the last ten years, we’ve amassed a lot of data, perspective, and experiences to help shed light on common veterinary student debt scenarios, much of which you can see reflected in the VIN Foundation Student Debt Center.

View the presentation below, and we encourage you to leave feedback or ask a question below in the comments!

If you don’t have time to watch the full presentation above, here are the presentation materials with links to valuable resources:

VIN Foundation | Supporting veterinarians to cultivate a healthy animal community | Blog | Furloughed and Unpaid Federal Veterinarians

Furloughed and Unpaid Federal Veterinarians

More than 3,000 veterinarians are Federal Government employees (USDA, FDA, EPA), and many work for agencies who are impacted when the government shuts down.  Even though the longest shutdown in U.S. history as just come to a close, there is a chance this will happen again in the future and impacted folks may still not have received back pay. 


This puts veterinary colleagues who work for the government and get furloughed, or otherwise do not receive income for working in an even tougher position if they have student loans. However, any reduction of your income (like when the government shuts down) provides a reason to re-evaluate your student debt repayment strategy and consider an income-driven student loan repayment plan (IBR, PAYE, REPAYE) to reduce your current monthly payment under IBR, PAYE or REPAYE.