What is a Federal Consolidation Loan?
A Federal Consolidation Loan is a loan that repays some or all of your outstanding eligible federal student loans, and replaces the multiple payments you may be making each month with a single payment. In most cases, your repayment term is extended to make your monthly payments more affordable, however, you may always prepay your loan with no penalties. The interest rate on the consolidation will be a fixed rate for the entire term equal to the weighted average interest rates of your consolidated student loans rounded up to the nearest 1/8% not to exceed 8.25%.
A Federal Consolidation Loan allows students and parents to refinance their existing federal education loan debt into one new low fixed interest rate loan. In addition to the low interest rate, when you consolidate through ELF you have the option of lowering your monthly payment by extending your payment term without any prepayment penalty.
