Should You Consolidate Your Medical School Debt?

Should You Consolidate Your Medical School Debt?

Consolidation is an option for students dealing with multiple loans and servicers. With loan consolidation, all of your loans are bundled together so you can make a single monthly payment. Consolidation is available for both federal and private loans, but is it right for you?

Below, we’ll examine all of your loan consolidation options and explain which methods of consolidation might work best for your unique situation.

Lowering Your Payments with Loan Consolidation

In many cases, you can lower the amount you pay each month with loan consolidation. When you consolidate your loans, you transition from a 10-year repayment term to up to a 30-year term.  While you can pay off the loan early without penalties, the stretching of the term reduces cost in the short term but could mean more interest if you take the full term to pay it off.

If you have both private and federal loans, consolidation can take an enormous amount of stress away. If you consolidate your federal loans, you can ask for a Mandatory Medical Residency Forbearance that allows you to postpone all of your federal loan payments while you are completing your residency. This also gives you the opportunity to focus solely on paying any private loan debt you may have.

If you’re considering working in public service, you may have to consolidate Direct Loans in order to make federal loans eligible for Public Service Loan Forgiveness. Not all loans need to be consolidated to be eligible for PSLF and it’s best to speak to a financial advisor before consolidation.

Other programs, such as the Pay As You Earn (PAYE) or the Income-Based Repayment Plan (IBR), require the consolidation of federal loans. You can learn more about these programs and see if consolidation is right for you by visiting

Nearly everyone will graduate medical school with debt, but how you handle that debt will go a long way in determining your overall quality of life.

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