Do some extra homework if you have Perkins loans, or if you’re still in school.It can be more complicated, and you don’t want to unknowingly give up any benefits.

Instead of making multiple payments to multiple lenders, the borrower only has to pay off the new consolidation loan, says Michelle Pezzulli, vice president of operations for Credit Union Student Choice, a student lending service provider in Washington, D.

C."That new loan will have its own interest rate; it will have its own repayment terms; it will have its own terms and conditions," she says.

Student loan consolidation is the act of putting various (or even one) loan into a new package.

You get some special benefits, and you can structure the loan the way you want.

Consolidation provides grads with the ability to combine their student loans into one megaloan, but it comes with drawbacks.

Along with gaining a new degree, many graduates will also leave campus with new student loan payments they'll have to fit into their post-graduate budgets.

Also, for student loan borrowers with older loans, consolidation can make you eligible for newer repayment plans that may be more favorable.

Make nine out of 10 on-time payments using the same formula as Income-Based Repayment, which would cap your monthly payment to 15 percent of your income or less.

The purpose of this article is to walk you through the process of understanding exactly what direct consolidation loans are, when they make sense, and when they don’t.