What are FFELP student loans?

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Federal Family Education Loan Program (FFELP) Loans are federal student loans that were available through June 2010. These loans were originally funded by private companies, but most are currently owned by the U.S. Department of Education. In 2010, FFELP was replaced by the Direct Loan program in use today.

While new loans are no longer being issued through the FFEL Program, many college borrowers still have FFEL loans. Here’s what to know if you took out your student loans before 2010.

What are FFELP Loans?

FFEL loans are student loans that were originally made by private lenders but guaranteed by the federal government. Many of these loans were purchased by the U.S. Department of Education during the 2007-08 financial crisis before the program was discontinued on June 30, 2010.

Now, some FFEL loans are still held by private lenders, while others are held by the Department of Education. The three types of FFEL loans are Stafford Loans, FFEL PLUS Loans and Consolidated Loans.

Are my loans FFEL Loans?

If you have student loans that originated before 2010 and you have never consolidated or refinanced, chances are you have FFEL loans. If you want to know which type of federal student loans you have, log in to the Federal Student Aid website or the National Student Loan Data System using your FSA ID.

How has the coronavirus affected FFEL loans?

When the COVID-19 pandemic began, the federal government took steps to help borrowers avoid defaulting on their student loans. This included a temporary interest rate of 0 percent on most federal student loans, as well as a pause on payments due. This temporary plan has been extended multiple times and is currently in place through Sept. 30, 2021.

Originally this relief applied only to federal student loans. However, the U.S. Department of Education recently announced that the interest rate and payment pause would be extended to  an estimated 1.4 million borrowers who have FFEL loans that are in default. The move also suspended any collections activities on those defaulted loans and made relief retroactive to March 13, 2020.

If you have FFEL loans in good standing, you still won’t qualify for this payment pause.

How to get FFELP Loan forgiveness

If you have FFELP Loans, there are several different repayment options available to you, including options that lead to loan forgiveness.

Most FFEL borrowers are eligible for the Income-Based Repayment (IBR) Plan, which has you pay 10 or 15 percent of your discretionary income for 20 or 25 years before forgiving remaining loan balances. The one exception is FFEL loans for parents, which do not qualify for this repayment plan.

Most types of FFEL loans can also be consolidated with a Direct Consolidation Loan, in which case you may become eligible for additional repayment plans that lead to forgiveness after a number of years of repayment. For example, you can repay a Direct Consolidation Loan using Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE) or Income-Contingent Repayment (ICR).

If you consolidate your FFEL loans, you could also become eligible for Public Service Loan Forgiveness. This program, designed for people who work full time in a qualifying public service position, forgives remaining loan balances after 10 years of payments on an income-driven repayment plan.

FAQ about FFELP Loans

Are FFEL loans federal or private?

Some FFEL loans are currently held by the U.S. Department of Education, but others are held by private lenders. To find out who holds and services your loans, log in to the Federal Student Aid website using your FSA ID.

Can I consolidate FFEL Loans?

You can consolidate FFEL loans through a Direct Consolidation Loan in order to pave the way for more repayment options and forgiveness plans. Keep in mind that if you consolidate in order to enter an income-driven repayment plan, payments made before you consolidated may not count toward the required number of payments for loan forgiveness.

Are FFEL loans covered by the CARES Act?

COVID-19 student loan relief applies to federally owned student loans, which can include FFEL loans. However, commercially held loans are not eligible for the 0 percent APR or payment pause unless they are currently in default.

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Written by
Holly D. Johnson
Author, Award-Winning Writer
Holly Johnson began her career working in the funeral industry, which may make you wonder why she works in personal finance now. Yet, the funeral industry taught the author everything she needs to know about the value of one's money and time. Johnson left the mortuary business a decade ago in order to explore her passion for personal finance and travel the world, and since then, she and her husband have built a debt-free lifestyle that has them on the path to retire very wealthy in their 40s. Holly's love of budgeting also led to the creation of her debt payoff book, “Zero Down Your Debt: Reclaim Your Income and Build a Life You’ll Love."
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