Hurry! Only six weeks left to consolidate student loan debt for a shot at forgiveness

It’s last call to consolidate your student loans and have a shot at getting your debt canceled.

The U.S. Education Department set April 30 as the deadline for borrowers to consolidate federal student loans and get a one-time payment adjustment this summer. Consolidating debt could help anyone hurt by loan servicing failures receive credit for the time they have already spent in repayment. The April deadline was extended from Dec. 31.

Ensuring that all debt payments are counted could get borrowers' remaining student loan balances canceled or bring them closer to it. Through an income-driven repayment (IDR) plan, loans can be canceled after 10, 20, or 25 years of eligible payments. If borrowers are seeking Public Service Loan Forgiveness (PSLF), these extra payment periods count toward that program if they meet other eligibility requirements. Any extra payments the Department of Education uncovers will be refunded too.

This one-time initiative “provides much-needed relief to borrowers who have been in repayment for 20 years or more and gives all other borrowers an accurate picture of their progress toward forgiveness going forward,” Richard Cordray, chief operating officer of the Federal Student Aid Office, wrote in a blog post last December. Updated payment counts have so far provided $45.7 billion in relief for 930,500 borrowers, the Biden administration said in January.

What you need to do to get a one-time adjustment

Many borrowers with federally held loans don’t have to do anything. The Department of Education examines their loans and makes the automatic adjustment.

Learn more: Best personal loans

Borrowers with privately held Federal Family Education Loan (FFEL), Perkins, or Health Education Assistance Loan (HEAL) loans must apply for a Direct Consolidation Loan online or with a paper form by April 30 to be eligible for the payment count adjustment. Most borrowers who made qualifying payments that exceeded the applicable forgiveness period of 20 or 25 years, will receive a refund for their overpayment, the Department of Education said.

If you have a Parent PLUS loan managed by the Department of Education and at least 25 years – or 300 months – in repayment, your loan will be automatically canceled through this one-time adjustment, the Consumer Financial Protection Bureau said. Parent PLUS borrowers with fewer than 25 years should consolidate their loans by the end of April to receive the one-time adjustment benefit.

Another extended deadline to know:Student loan borrowers may save money with IDR recertification extension on repayment plan

How do I know what kind of loan I have?

◾ Log onto the StudentAid.gov website.

◾ On your dashboard, click the “Loan Breakdown” section to view a list of your loans.

◾ Direct Loans start with the word “Direct.” Federal Family Education Loan Program loans begin with “FFEL.” Perkins Loans use the word “Perkins” in their name. If your servicer's name starts with “Dept. of Ed” or “Default Management Collection System,” your FFEL or Perkins loan is already held by the Education Department. If your loan has a different servicer’s name, your loan is privately held and needs to be consolidated by April 30.

Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.