Federal Family Education Loans Program (FFELP) Loans are federal student loans available until June 2010. These loans were originally funded by private companies, but most are currently owned by the US Department of Education. In 2010, FFELP was replaced by the direct loan program in effect today.

Although new loans are no longer given under the FFEL program, many university 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FFEL loans are student loans originally made by private lenders but guaranteed by the federal government. Many of these loans were purchased by the US Department of Education during the 2007-08 financial crisis before the program was halted on June 30, 2010.

Today, some FFEL loans are still held by private lenders, while others are held by the Ministry 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 born before 2010 and have never consolidated or refinanced, chances are you have FFEL loans. If you want to know what type of federal student loan you have, log on to Federal Student Aid website or the National Student Loans Data System using your FSA ID.

How has the coronavirus affected FFEL loans?

When the COVID-19 pandemic began, the federal government took action to help borrowers avoid defaulting on their student loans. This included a temporary 0 percent interest rate on most federal student loans, as well as a break on payments owed. This temporary plan has been extended several times and is currently in place until September 30, 2021.

Originally, this relief only applied to federal student loans. However, the US Department of Education recently announced that the interest rate and payment suspension will be extended to approximately 1.4 million borrowers who have past due FFEL loans. The ruling also suspended all collection activity on these delinquent loans and made the relief retroactive to March 13, 2020.

If you have FFEL loans in good standing, you still will not be eligible for this payment break.

How to get FFELP loan forgiveness

If you have FFELP loans, you have several repayment options available to you, including options that lead to loan forgiveness.

Most FFEL borrowers are eligible for the Income Based Repayment Plan (IBR), which allows you to pay 10 or 15 percent of your discretionary income for 20 or 25 years before canceling any remaining loan balances. The only exception is FFEL loans to parents who are not eligible 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 a forgiveness after a certain 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-Based Repayment (ICR).

If you consolidate your FFEL loans, you could also become eligible for the utility loan forgiveness. This program, designed for people working full-time in an eligible public service position, cancels out remaining loan balances after 10 years of payments on an income-based repayment plan.

FFELP Loans FAQ

Are FFEL loans federal or private?

Some FFEL loans are currently held by the US Department of Education, but others are held by private lenders. To find out who owns and manages your loans, log on to Federal Student Aid website using your FSA ID.

Can I consolidate FFEL loans?

You can consolidate FFEL loans through a direct consolidation loan to pave the way for more repayment options and discount plans. Keep in mind that if you consolidate to get into an income-driven repayment plan, payments made before the consolidation may not count toward the number of payments required for loan forgiveness.

Are FFEL loans covered by the CARES law?

COVID-19 student loan relief applies to federally owned student loans, which may include FFEL loans. However, loans held in commerce are not eligible for 0% APR or suspension of payment unless they are currently in default.

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