Prior to July 1, 2006, married borrowers could choose to consolidate federal student loans from both spouses or jointly consolidate the loans of either spouse. Both borrowers had to agree to be jointly and severally liable for repayment. Not surprisingly, this caused a lot of problems for borrowers and Congress eliminated the program as of July 1, 2006. Another common problem is that partial discharge of a joint consolidation loan under any of the discharge programs (other than death discharge) does not eliminate joint liability for the remaining balance. Further, borrowers with joint FFEL consolidation loans, according to the Department, may not reconsolidate into Direct Loans and therefore are not eligible for public service loan forgiveness.
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