- Sallie Mae reserves the right to approve a lower loan amount than what the school has certified.
- SALLIE MAE RESERVES THE RIGHT TO MODIFY OR DISCONTINUE LOAN PROGRAMS AND BORROWER BENEFITS AT ANY TIME WITHOUT NOTICE. APPLICANTS SHOULD CHECK THE SALLIE MAE WEBSITE CLOSE TO THEIR LOAN DISBURSEMENT DATE TO OBTAIN THE MOST UP-TO-DATE INFORMATION REGARDING LOAN PROGRAMS, INCLUDING BORROWER BENEFITS
What is significant about this?
- The first point leaves open the possibility that a Sallie Mae private loan may not always help fill the student's financing "gap". Sallie Mae has the right to approve a lower loan amount than what the school has certified. This term could create the situation where a student is left scrambling to find additional funds if Sallie Mae exercised this right.
- The second disclosure certainly makes it difficult for a borrower to place much value in any borrower benefits since they can be modified or discontinued at any time WITHOUT notice. With plaintiff lawyers circling lenders who have discontinued borrower benefits (See story about borrower suing a student loan firm after having their 0.75% borrower benefit eliminated), it is not a surprise to see Sallie Mae seeking to limit their legal exposure.
- The fact that these changes to borrower benefits can occur "without notice" would not qualify as a best practice in how to please your customers. Imagine the borrower's delight when they find their monthly payment goes up without any explanation required from the lender (Is this what is meant by "Truth in Lending?")