What to Do If You Regret Consolidating or Refinancing Your Student Loans

 June 13, 2019
How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

Student Loan Hero is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the marketplace.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Editorial Note: This content is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the financial institution.


We’ve got your back! Student Loan Hero is a completely free website 100% focused on helping student loan borrowers get the answers they need. Read more

How do we make money? It’s actually pretty simple. If you choose to check out and become a customer of any of the loan providers featured on our site, we get compensated for sending you their way. This helps pay for our amazing staff of writers (many of which are paying back student loans of their own!).

Bottom line: We’re here for you. So please learn all you can, email us with any questions, and feel free to visit or not visit any of the loan providers on our site. Read less

Refinance Student Loan rates starting at 1.88% APR

1.88% to 6.15% 1

Visit Lender

1.88% to 5.64% 2

Visit Lender

2.50% to 6.85% 3

Visit Lender

  • Variable APR

Student loan consolidation and refinancing are supposed to be boons to your repayment, providing you either the lower monthly payment or reduced interest you desire.

But if you sought the rewards without considering the risks, you might already be regretting your decision to consolidate or refinance your debt.

Unfortunately, these measures are almost always irreversible once complete. Still, you could problem-solve your way out of a regrettable situation.

When it’s not too late to undo consolidation or refinancing

Consolidating your student loans with the federal government is different from refinancing them with a private lender. But one commonality between the loan management strategies is that it’s usually impossible to nix your decision.

Can you cancel your consolidated loan?

A direct consolidation loan groups your federal loans into one new debt with a weighted interest rate. It could help you switch to a fixed rate, choose a new loan servicer and even cap your monthly payments via newly eligible repayment plans.

After applying for consolidation, you should receive a notice from the U.S. Department of Education giving you an opportunity to confirm which loans you want to consolidate. (If your regret is simply not including all your federal loans on your application, you have up to 180 days after your consolidation loan is made to add other eligible debt.)

The only gray area could be the amount of time it takes for your old loans to be paid off and transitioned into new debt. If you haven’t heard from your new consolidation servicer, it might not be too late. Contact the servicer as soon as possible to see if you beat the deadline.

Once your consolidation is done, however, it’s done. The loans that you consolidated were already paid off and, as a result, no longer exist.

You’d have more leeway if you indicated on your consolidation application that you wanted to delay the loan’s processing until after the completion of your grace period. But once your grace period expired, you’d likely be out of luck.

Can you cancel your refinanced loan?

Like with consolidation, refinancing pays off your old loans and creates a new one.

Believe it or not, there’s more of a reprieve in this process when working with some banks, credit unions and online lenders.

Once you’ve refinanced, you might still be able to undo it — if you act quickly. Here are some examples of lenders that offer a quick, escrow-like period after you sign your loan agreement:

Beating the clock — canceling with CommonBond in nine days, for example — would help you reset your student loan situation.

If you’re unsure about your refinancing lender’s “right to cancel” policy, review the promissory note you signed. Also, seek clarification via customer service.

If it’s too late revert your refinanced loan, you could refinance again with the same (or another) company.

Of course, refinancing yet again might not solve your problem.

What to do when it’s too late to undo consolidation or refinancing

Although it might be past the point for a do-over on your newly consolidated or refinanced education debt, you could find ways to improve your new reality.

Start by asking yourself why you regret the decision. That explanation should lead to the best next step for your repayment.

Decision Reason for Regret Possible Solutions
Consolidation Hating your new loan servicer Either complain to the Federal Student Aid Ombudsman Group or, if you have another eligible loan, consolidate a second time with a new servicer
Consolidation Paying more interest over time on your new income-driven repayment (IDR) plan Either switch repayment plans (for free) or make extra payments whenever possible
Consolidation Losing progress toward Public Service Loan Forgiveness or cancellation at the end of an IDR term Survey other student loan forgiveness programs offered by the federal and state governments, as well as employers, that won’t penalize you for consolidating
Refinancing Despising your new lender Refinance a second time with a new bank, credit union or online lender with a stronger customer service record
Refinancing Choosing a variable interest rate Refinance again, choosing a fixed rate this time
Refinancing Missing federal loan protections such as forbearance and IDR Ask your refinancing company about the safeguards it offers, as some lenders offer the chance to pause or reduce payments, albeit in a more limited fashion

Before enacting a new solution for your consolidation or refinancing regret, double-check that it’s the right measure to take.

If you’re stuck with a variable interest rate on your newly refinanced debt, for example, don’t jump at the first fixed-rate offer from a refinancing competitor. Take the time to shop around for the lowest possible fixed rate, taking a break from the search — if necessary — to improve your credit or find a willing cosigner.

You’d also be wise to calculate the cost of your repayment under the new rate to ensure it won’t be more expensive than sticking with your current variable rate.

For every repayment problem — whatever yours is — there’s a solution. To find it, you might have to reset your student loan expectations.

Want to earn extra money?

Here are the best side hustle opportunities!
CompanyType of WorkRequirements 
RidesharingCar and smartphone

Become a Lyft Driver

Rent out your carOwn a vehicle

List Your Car

Rent out spaceRoom to host guests

Become an Airbnb host

Odd jobsSmartphone

Become a TaskRabbit Tasker


Become a Postmates Worker