Barclays Capital analysts believe that the temporary and minor increase in prepayments from the Special Direct Consolidation program will have a limited effect on FFELP ABS bond valuations, according to the firm’s latest Consumer ABS Weekly.

The Special Direct Consolidation Program, which began on Jan. 17 and had a deadline of June 30, offered student borrowers the opportunity to consolidate multiple student loans held and serviced by various entities into a single direct loan from the U.S. government. Consolidation under this program would mean that particular program would lead to a borrower’s existing loans being prepaid as well as a new loan being disbursed.

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