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HESC Symposium Unlocking the Mysteries of Private Student Loans. This presentation does not constitute formal policy or legal advice and should not be relied upon as such. Unlocking the Mysteries of Private Student Loans Agenda. What is the current state of the private student loan market? - PowerPoint PPT Presentation
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Slide 1© Student Lending Analytics, LLC
HESC SymposiumUnlocking the Mysteries of Private Student
Loans
This presentation does not constitute formal policy or legal advice and should not be relied upon as such.
Slide 2© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Agenda
What is the current state of the private student loan market?
How are schools addressing this shortfall in private student loans?
How can financial aid staff inform and educate students about private student loans?
How will the regulatory environment impact private loan disclosure in the future?
What is the outlook for 2009-10 and beyond?
Slide 3© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Growth in Private Student Loans
Source: College Board Trends in Student Aid, 2007-08
Slide 4© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
The Difference That Two Years Makes
2007 2009 (estimates)
Loan Volume $19 billion $10-$12 billion
Avg. Loan Margins LIBOR + 5% LIBOR + 9% to 10%
Min. FICO score 620 to 630 680 to 700
Cosigners 50-60% 80-90%
Quarterly Gross Defaults 0.7% 1.2%
Number of Lenders Multiple choices Limited choices
Sources: College Board data used for 2007 Loan Volumes and SLA estimates for 2009 Loan Volume estimates, reviewed securitization prospectus for Loan Margins, DBRS research for Quarterly Gross Defaults
Slide 5© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Lender List Penetration Rates
77%72%
69%65%
36%
28%24%
21%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
Chase WellsFargo
SallieMae
Citibank Discover US Bank SunTrustBank
PNCBank
Per
cen
tage
of
Tot
al
Source: SLA Analysis of 425 private loan lender lists, August 2009
Slide 6© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Interest Rate Ranges For Major Lenders
4.25% 4.25% 3.88%4.41%
5.02% 5.20% 5.38%4.38%
11.00% 11.24% 11.13% 11.16%
12.87%12.20% 12.13%
14.38%
0.0%
5.0%
10.0%
15.0%
Discover WellsFargo
SunTrust PNCBank
Chase U.S.Bank
Citibank SallieMae
Cu
rren
t S
tart
ing
Inte
rest
Rat
e R
ange
s (I
nd
ex +
Mar
gin
)
Fees None None 0% to 6% 0% to 6% None None 0% to 6% 0% to 5%
Source: SLA analysis of repayment examples on lender websites, September 2009
Slide 7© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Interest Rate Distribution in Private Loan Securitization
1%
4%
26%
17% 17%
4%
31%
0.0%
10.0%
20.0%
30.0%
40.0%
Less than7%
7.0% to7.99%
8.0% to8.99%
9.0% to9.99%
10.0% to10.99%
11.0% to11.99%
Over 12.0%
Per
cen
tage
of
Tot
al L
oan
s in
SL
M 2
007-
A T
rust
Source: SLM Private Credit Student Loan Trust 2007-A, March 2007
Slide 8© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Recent Changes to Private Loan Margins
Lender Date of Change
Minimum Margin
Maximum Margin
Notes
Discover June 2009 150bp 300bp Margin increase
Citibank June 2009 188bp 212bp Shifted from Prime to LIBOR
Chase June 2009 -110bp No change
Margin on cosigned loans reduced
PNC Bank July 2009 175bp 275bp Margin increase
Wells Fargo July 2009 -150bp -150bp Reduced floor on Prime index
Slide 9© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Customized Pricing: Chase Select Loans
3.20%3.65%
4.40% 4.40%
7.50%
9.75% 9.75% 9.75%
0.0%
5.0%
10.0%
15.0%
PENN George Washington UConn Drexel
Cu
rren
t M
argi
ns
on P
riva
te S
tud
ent
Loa
ns
3ML
+ S
tate
d M
argi
n
2007 Cohort Default Rate: 0.7% 1.2% 2.0% 2.0%
Source: SLA Analysis of lender lists at these institutions, September 2009
Slide 10© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What About Credit Unions?Credit Union Student Choice
– Network of over 80 credit unions nationwide– Variable-rate loans usually based on one-month LIBOR– Average funded rate of 5.8% with no origination fees– Structured as credit line– Loan limits up to $75,000– Requires membership in credit union to apply – Cosigner recommended
Individual credit unions in college towns often provide competitive student loans and transparent disclosures too
– University of Southern California Credit Union (3.3% to 6.8%)– University of Wisconsin Credit Union (4.0% to 9.5%)– University Credit Union serving University of Maine system (3.25% to 7.75%)
Do not assume credit unions ALWAYS offer better rates and terms
Slide 11© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Transparent Disclosures
• University Credit Union (Maine)
• University of Southern California Credit Union
3-month LIBOR + Margin= Interest Rate
Borrower (with Cosigner)
Borrower Only (No Cosigner)
FICO Score Margin Margin
750 and above 2.00% 2.00%
730 to 749 2.50% 3.00%
700 to 729 3.00% 3.50%
680 to 699 4.00% 4.50%
660 to 679 5.50% 6.00%
Slide 12© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
State Alternative Loan Programs – Fixed Rate
State Loan Name Current Rate Fees
Alaska Suppl. Ed. Loan 7.30% 5%
Connecticut CT FELP TBD TBD
Massachusetts MEFA 7.75% to 8.89% 4%
New Jersey NJCLASS 7.62% to 7.92% 2%
North Dakota DEAL Loan 5.99% to 7.90% 0% to 2%
Rhode Island RI Family Ed. 7.76% 4%
Texas College Access 6.00% 3% to 5%
Slide 13© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
State Alternative Loan Programs – Variable Rate
State Loan Name Current StartingRate
Fees Index
Maine Maine Loan 8.43% 4% MELA Bond Rate
Minnesota SELF Loan 4.30% None 3ML + 3.5%
North Carolina Extra Educ. 7.00% None 3ML + 3.0%
North Dakota DEAL Loan 2.1% to 3.1% 0% to 2% 3ML + 1.5% to 2.5%
Texas College Access Loan
3.91% 3% to 5% N/A
Vermont VSAC Extra Advantage
5.19% to 8.19%
0% to 5% 3ML + 4.25% to 7.25%
Slide 14© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What Determines Pricing on Private Loans?
Competitive dynamics
Cost of capital
Availability of capital
Return expectations– Shareholders– Members
Default/Writeoff experience
Slide 15© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans Agenda
What is the current state of the private student loan market?
How are schools addressing this shortfall in private student loan capacity?
How can financial aid staff inform and educate students about private student loans?
How will the regulatory environment impact private loan disclosure in the future?
What is the outlook for 2009-10 and beyond?
Slide 16© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Level of Concern About Private Loan Availability
Survey question: How concerned are you about the availability of PRIVATE loans for your students for the 2009-10 academic year?Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
14%
44%
17%
52%
6%
38%
4%
31%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
Very Concerned Somewhat Concerned
Per
cen
tage
of
Tot
al R
esp
ond
ents
Overall
4-year private
4-year public
2-year public
Slide 17© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Perceived Availability of Private Loans
7%
46%
25%
1%
21%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
Much LowerApproval Rates
Lower ApprovalRate
Same ApprovalRate
Higher ApprovalRates
Not Sure
Per
cen
tage
of
Tim
e T
hat
Com
pan
y W
as M
enti
oned
By
Sch
ools
L
ink
ing
to A
ny
Th
ird
-Par
ty S
ite
Survey question: Please describe your impressions regarding private loan approval rates for your students today, as compared to a year ago. Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
Slide 18© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Strategies for Dealing with Private Loan Issues
Survey question: What are your current strategies to help students find private, nonfederal loans for the 2009-10 school year?Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
73% 77%
60%
16%
78% 73%
54%
25%19%
3%
16%
50%
15%
51%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
Paren
t PLUS
Co-sig
ner
Tuitio
n Rep
aym
ent P
lans
Couns
eling
State
pro
gram
s
Insti
tutio
nal L
oans
Multi
ple Len
ders
Credi
t Unio
ns
Per
cen
tage
of
Tot
al R
esp
ond
ents
Aug-08
Jun-09
Slide 19© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans Strategies To Address Private Loan
ShortfallCosigners– Increase odds for approval while ensuring best rate on the loans– Almost a requirement these days
• Sallie Mae targeting 90% of loans to have cosigner• Wells Fargo recently eliminated credit-ready loans for juniors/seniors/
graduate students
Parent PLUS loans– Interestingly, PLUS loan volumes may not have increased despite easier credit
terms and deferment option, which went into effect July 1, 2008– FFEL PLUS Loans have denial rates 2X as high as DL PLUS (FinAid research)– Opportunity for additional unsubsidized Stafford if application turned down
Tuition repayment plans– Three major vendors:
• FACTS/Nelnet Tuition Management (Nelnet)• Tuition Management Systems (Key Bank)• TuitionPay (Sallie Mae)
Slide 20© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Prevalence of Private Loan Lender List
Survey question: Is your institution planning to provide students with a lender list for private loans for the 2009-10 school year?Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
56%
34%
10%
69%
21%
10%
42%
54%
4%
12%
65%
23%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
Yes No Not Sure
Per
cen
tage
of
Tot
al R
esp
ond
ents
Overall
4-year private
4-year public
2-year public
Slide 21© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Reasons Given For Not Providing Lender List
Survey question: Please describe the importance of these factors in determining why your institution will not be providing students with a lender list for private student loans for the 2009-10 school year. Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
3.9
3.5 3.53.3
2.9
2.3
0.0
1.0
2.0
3.0
4.0
5.0
Don't Want toEncourage
Private Loans
RFI Process ListMaintenance
Regulations Low Volumes Unable to FindLenders
Rel
ativ
e Im
por
tan
ce o
f F
acto
rs (
Mos
t Im
por
tan
t =
5.0
)
Slide 22© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Lender Selection Process for 2009-10
Survey question: Please describe your institution's process for developing a lender list for private student loans.Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
35%
32%
12%
8%
14%
0.0%
10.0%
20.0%
30.0%
40.0%
Formal RFI Keep List from08-09
All Lenders Last3-5 Yrs
Informal Process OtherPer
cen
tage
of
Res
pon
den
ts W
ith
Len
der
Lis
t fo
r 20
09-1
0
Slide 23© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Information Provided on Lender List
Survey question: Describe the types of information that you will be providing about the lenders appearing on your institution's lender list for private loans. Source: SLA Flash Survey: Private Student Loans, June 2009 (187 respondents)
83%
69%65%
46%
23%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
Links to LenderWebsite
Loan Fees General InterestRate
Link toApplication
Specific InterestRate
Per
cen
tage
of
Res
pon
den
ts W
ith
Len
der
Lis
t fo
r 20
09-1
0
Slide 24© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Will Multiple Applications Harm Your Credit Score?
Research shows that students spend more time researching federal loan options than private student loan options
New policy from Fair Isaac (FICO score) on student loan shopping– “In general, student loan shopping inquiries made during a focused time period (for
example 30 days) will have little to no impact on your score.”
Advice from Fair Isaac on myfico.com site:– Doing a little homework first is always a good idea no matter what type of credit you're
seeking. – You can generally avoid having those inquiries affect your score if you finish your rate
shopping in a reasonable amount of time. – Then try to finish your rate shopping and finalize your loan within 30 days.– Not only will loan rates be easier to compare when the quotes come only a few days
apart, but you also will protect your FICO score.
SLA research found loan interest rates varied from 7% to 12% based on recent shopping of 6 major lenders
Slide 25© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans Agenda
What is the current state of the private student loan market?
How are schools addressing this shortfall in private student loan capacity?
How can financial aid staff inform and educate students to make good decisions about private student loans?
How will the regulatory environment impact private loan disclosure in the future?
What is the outlook for 2009-10 and beyond?
Slide 26© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Who Is Taking Out Private Loans?
Source: Project on Student Debt analysis of NPSAS data, August 2009
12% 11%
5%
1%
42%
25%
14%
4%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
For-Profit 4-YR Private 4-YR Public 2-YR Public
Per
cen
tage
of
Stu
den
ts T
akin
g O
ut
Pri
vate
Loa
ns
2003-042007-08
Slide 27© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Borrowers Not Maximizing Stafford Loans
Source: Project on Student Debt analysis of NPSAS data, August 2009
25%38%
11%
12%11%
14%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
2003-04 2007-08
Per
cen
tage
of
Stu
den
ts T
akin
g O
ut
Pri
vate
Loa
ns
Did Not Apply For Federal Aid
Completed FAFSA, No Stafford
Borrowed Less Than Maximum
48%
64%
Slide 28© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Counseling Topics
25%
17%
21%
30%
23%
32%
51%
36%
44%
48%
49%
58%
53%
43%
0.0% 10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
FAFSA
Appeal EFC
Impact of Scholarships on Aid
Loans
Professional Judgment
Jobs
Scholarships/Grants
Very Frequently
Frequently
Source: SLA Flash Survey on Financial Aid Counseling, July 2009
Slide 29© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
The Purchasing Decision
Decision makers: Parents of undergraduates
Federal funding options: Aware but confused
Rationale for choosing private loans: – Time constraints– Incomplete funding to cover all costs of education – Ineligibility for Federal aid
Sources for information about private loans: Rely heavily on schools
Importance of name recognition: Many chose based on this factor
Frequency of comparison shopping: Many went with the first loan offered to them
Source: Federal Reserve Consumer Research and Testing, 2009
Slide 30© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
The Purchasing Decision
Focus on interest rates first
Factors that determine rates are important to consumers
Variable-rate nature of these loans worries consumers– Want to see historical rates so they have some context
Consumers want to see fees expressed in dollars and also want to understand rationale for fees also
Information about availability of federal loan alternatives was found to be useful
Understanding of basic loan terminology often confusing to consumers– Concept of loan margin
Many want to speak to a live person tooSource: Federal Reserve Consumer Research and Testing, 2009
Slide 31© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Calls To Lender Customer Service Centers
The Good…– “Gave great details on each program and recommended that I explore other
lenders to find the right one for me.”– “Especially thorough about repayment information explaining exactly how
that would work and when I would have to pay what.”– “A great CSR! Walked me through each loan slowly and carefully, making
sure I understood all aspects.”– “Advised work study as an option.”
And Not So Good– “All but ignored federal loans, even when I mentioned that I had not yet used
my Stafford loans.”– “Pushed me to begin the application over the phone immediately.”– “Really pushed the private loan. "What most college students go for.”– “Could not have wanted to get off the phone faster. Provided only the most
basic information on topics.”
Source: SLA Lender Call Center analysis, September 2009
Slide 32© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Entrance Counseling for Private Loans
Take out federal loans before ever considering these “last resort” loans
– Generally higher interest rates and less repayment flexibility than federal loans– Based on SLA research, the average private loan interest rate is 10%-11%
Cosigners almost always required
Know your interest rate before signing anything– Index (Prime or LIBOR) + Margin
Know that your interest rate will go up– Since 1990, 1 month LIBOR has ranged from 0.3% (current) to 9.125% (11/90)– “Tyranny of calculators”
Shop around!– SLA research in April 2009 found that for the same student and cosigner pairing
that interest rates varied from 7% to 12%
Slide 33© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Entrance Counseling for Private Loans
Study the details in the promissory note– Can the lender increase your interest rate if you are late with one payment?– How many days after the due date is a payment considered late?– What fees does the lender charge beyond the origination/repayment fee?– How frequently will your interest rate change? Monthly payment change?
Borrowers have option to cancel the loan
If you can pay interest only during while you are in school, DO IT!– It can save you thousands of dollars in loan repayment
Expand your alternatives by considering credit unions or state-run alternative loan programs
DO NOT take out a private loan if you can avoid it!
Slide 34© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Exit Counseling for Private Student LoansCongratulations on your upcoming graduation…now it is time to repay your student loans!
These loans will not go away if you don’t pay them– May not be dischargeable in bankruptcy– Stay with you even in death
Once you have settled down to your new address, notify your lender so coupon books/statements will reach you
Find your original paperwork, including your promissory note and Disclosure Statement – Contact lender if you can’t find it
Be pro-active with the borrower benefits that you were promised
Confirm the date that your first payment will be due– Typically have 6 month grace period after graduation
Slide 35© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Exit Counseling for Private Student LoansDo not be surprised that your current loan balance is higher than the amount of your original loan
If you are concerned about your ability to make payments on your loans, contact the lender immediately to discuss your options– Forbearance allows you to postpone payments
Your monthly payment will typically be adjusted quarterly or annually by the lender– Expect that interest rates and therefore your monthly payment will increase
as the economy improves
Set up your monthly student loan payment on auto-pay– Earn a reduction in interest rates from 0.25% to 0.50%– Eliminate potential for late fees, which can run as high as $30
If you are ready to pay down some extra principal, contact the lender in case you need to make any special notation on the payment
Slide 36© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans Agenda
What is the current state of the private student loan market?
How are schools addressing this shortfall in private student loan capacity?
How can financial aid staff inform and educate students to make good decisions about private student loans?
How will the regulatory environment impact private loan disclosure in the future?
What is the outlook for 2009-10 and beyond?
Slide 37© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What Is a “Preferred Lender Arrangement”?
Definition of preferred lender arrangement (from HEOA)– Preferred lender arrangement.--The term `preferred lender
arrangement'-- (A) means an arrangement or agreement between a lender and a covered institution or an institution- affiliated organization of such covered institution
• (i) under which a lender provides or otherwise issues education loans to the students attending such covered institution or the families of such students; and
• (ii) that relates to such covered institution or such institution-affiliated organization recommending, promoting, or endorsing the education loan products of the lender;
NPRM: Lender list that does not have all lenders who lend to students at schools IS A “preferred lender arrangement”
Slide 38© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What Are Requirements for A Preferred Lender List?
Web site
Publications
Mailings
Electronic messages
Materials that describe or discuss education loans
Slide 39© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What Are Requirements If I Have A Preferred Lender List?
Describe method and criteria of selection which must be best in the best interest of borrowers
Indicate reasons why each lender was selected
Disclose that there is no requirement for borrower to choose lender on the preferred lender list
Must have minimum of two lenders on list and disclose any affiliate relationships
Exercise a duty of care and a duty of loyalty in compiling the list
Not less than the information required to be disclosed under section 153(a)(2)(A)
File an Annual Report
Slide 40© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
What If I Just Provide Information About Private Loans?
Model disclosure forms required under Truth-In-Lending Act– Lenders will provide
Information on availability of Title IV loans or other assistance
Statement to the effect that Title IV loan terms and conditions “may be more beneficial than those of private loans”
Provide information before students or families select a lender
Information must be provided in manner distinct from Title IV loans
All of this information must be provided whether or not school has “preferred lender arrangement”
Slide 41© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Regulation Z and Private Student Loan Disclosure
Federal Reserve provided final rules in July 2009
Compliance Date: February 14, 2010
Key regulations:– Consumer has thirty days after approval to decide whether to take loan– Consumer can cancel loan for up to three business days after
consummation
Disclosure requirements– Application– Approval– After consumer accepts the loan
Borrower must complete self-certification form– Lender must have signed and completed form before consummating loan
Slide 42© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Regulation Z DetailsExemptions– Extensions of credit with a term of 90 days or less (“emergency loans”)– Tuition billing plans
• Interest rate not applied to balance• Term of less than a year• May be payable in more than four installments
Includes disclosure of private education loan discharge limitations in bankruptcy on application forms
Disclosure of federal loan options– “May be obtained in lieu of or in addition to private education loans”– “Federal Loan Alternatives”
Sets maximum rate at 25%, where one is not available
Co-branding prohibition and preferred lender lists– “[Name of loan] is not being offered or made by [school] but by [lender].”
Slide 43© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Self-Certification FormLender must obtain from consumer a self-certification form before consummating the loan– Cost of attendance– Specific information about consumer’s other financial aid and need
May be provided to consumer in electronic format
Dept. of Education must develop the form
Form will include statement to the effect that “Consumer is encouraged to communicate with the financial aid office about the availability of other financial aid.”
Final rule permits lenders to provide form directly to the consumer
Slide 44© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Information from Preferred LendersResponsibility: Lenders must provide the general loan information required on the application form to the educational institution that it has a preferred lender arrangement with
Timing: April 1st of each calendar year or within 30 days of entering into a preferred lender arrangement
Period covered: Applies to loans that lender plans to offer from July 1 of current calendar year to June 30 of the next calendar year
Knowledge of preferred lender arrangement: Lender not required to comply if not aware that it is a party to preferred lender arrangement
Financial Aid staff must contact lenders to receive model form
Slide 45© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Disclosure Requirements: Application Process
Slide 46© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Disclosure Requirements: Application Process
Slide 47© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Disclosure Requirements: Application Process
Slide 48© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
?????
Slide 49© Student Lending Analytics, LLC
Student Lending AnalyticsContact Information
For more information about SLA and our Private Student Loan Ratings Service, please contact us at:
Tim Ranzetta
Student Lending Analytics LLC
650-218-8408
www.studentlendinganalytics.com
Slide 50© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Student Lending Analytics: Resources Available
SLA Private Student Loan Ratings
2009 SLA Private Loan Series – Ten part series on topics ranging from finding a cosigner to reading the
promissory note
Student Lending Analytics Blog– Timely, insightful information about the student loan market
Private Loan Insight Survey
Student Satisfaction Surveys
Slide 51© Student Lending Analytics, LLC
Unlocking the Mysteries of Private Student Loans
Private Student Loan RatingsAvailable at http://www.studentlendinganalytics.com/ratings.html
Featured on front page of New York Times Business
Focused on evaluating eight lenders that appeared most frequently on over 700 school lender lists that SLA researched
Includes the following factors in ratings:– Expected loan cost– Borrower benefit savings– Fee structure – Flexibility of repayment options– Customer service – Financial stability
SLA receives no compensation from any lenders