Will borrower receive a penalty fee when submitting a monthly payment earlier than scheduled or for an amount greater than owed?

False-all federal education loans allow prepayment without penalty. for loans that are not in default, any excess payment is applied first to interest and then to principal. however, if the additional payment is greater than one monthly installment, payment must include a note with the payment telling the processor whether prepayment is to be treated as a reduction in the principal. otherwise, the government will treat it as though borrower paid the next payment(s) early, and will delay the next payment due date as appropriate. (it is best to tell them to treat it as a reduction to principal, since this will reduce the amount of interest borrower will pay over the lifetime of the loan.)