May 20, 2008

Student Loan Xpress Closes; Is Sallie Mae Leaving the Federal student loan program?

Posted in Misc at 12:30 PM by Joe From Boston


According to the San Diego Business Journal, CIT has closed down it’s student lending company Student Loan Xpress.

Also, there are rumors swirling around that Sallie Mae may drop out of the FFELP lending program, leaving millions of students in the lurch.

The Chronicle of Higher Education is reporting that executives at Sallie Mae are eagerly waiting new lender rules from the Department of Education which are expected to be unfavorable to lenders. They report that:

“Sallie Mae executives, including the company’s president, C.E. Andrews, and chief executive, Albert L. Lord, have scheduled a conference call with colleges for Wednesday to discuss “critical information” about the lender’s participation in the federally guaranteed student-loan program, according to a company announcement.

Sallie Mae officials have not explicitly described any plan to stop issuing government-backed federal loans, though several officials involved in student lending—who asked not to be identified by name because of the uncertainty, highly fluid nature, and huge stakes involved —have described company officials as promising to take that step if the Education Department offers terms they deem inadequate today. Sallie Mae officials declined to comment on the record.”

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3 Comments »

  1. Derrick,

    You need to contact your lender directly. I have no ability to look up your loans. If you’re not sure who your lender is, track down the paperwork you signed in college or try contacting the federal Department of Education – they can look that up for you. Visit http://www.nslds.ed.gov/nslds_SA/ to access the National Student Loan Database or call 1-800-4-FED-AID

    Have you already filed the paperwork? It can take a few weeks for the paperwork to go through the channels it needs to, so keep paying your loans until you have something in writing saying your loans are in forbearance.

  2. Derrick Rainey said,

    Hello, I just read this article and I am a member of City Year, an AmeriCorps program and I’m trying to apply for a loan forbearance til after my service year, 07/21/08-06/18/09. I am in need of knowing whether my loan forbearance is applicable towards my loan account.

    Please let me as soon as possible.

    Thank you,
    [edited to remove personal information]

  3. Another advantage student loan has over other loans is that the rates and terms are much more lenient. First of all, the interest rates for student mortgages are variable, much lower than other loans and at this moment there is a cap on the maximum interest you will pay. Secondly, depending on the repayment plan you choose, you can also take as much as 30 years to pay back your loans. Additionally, if your financial situation takes a nose-dive, you may also be eligible to defer repayment on your student mortgages up to three years and depending on what you do after school, some of the loan may be forgiven.


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