Student Lending Analytics Blog

Bad Debts Rise at For-Profit Strayer Education

Reuters is reporting on rising bad debt in Strayer's recent earnings anouncement:

"Strayer Education Inc (STRA.O) posted quarterly results above analysts' expectations, but shares of the company fell nearly 3 percent on concerns about a rise in its bad debt expense."

CBO Math: When Is A $7 Billion Cost Not A Cost?

There continues to be quite a bit of commentary recently about the Congressional Budget Office (CBO) and their estimates which have played a central role in the development of health care and student loan reform legislation. 

I picked up this blurb from the Economist ("Pity the CBO") from the College Affordability and Productivity Blog which provides a good summation of the shortcomings of CBO analyses:

Federal Reserve Releases Final Amendments To Private Student Loan Disclosure Regs

Here is the press release.  I will be reviewing over the next few days to see where they came out on issues raised in the comment letters, which I analyzed here and here and SLA's comments are here.   I will soon find out if those nights in May burning the midnight oil and crafting a 17 page comment letter to highlight my concerns will pay any dividends.  Stay tuned for updates...but remember that it the Federal Register announcement is 234 pages long. 

Upcoming SLA Webinar: What Do Financial Aid Administrators Think About...?

Join us for a Webinar on August 6 at 1:30 ET Space is limited. Reserve your Webinar seat now at: https://www2.gotomeeting.com/register/113163931 Wonder what your peers are thinking about: *  Federal student loan reform? *  The new Perkins loan proposal? *  Financial literacy programs? *  Availability of private student loans? *  Financial aid counseling? Join Tim Ranzetta of Student Lending Analytics on Thursday, August 6th at 1:30pm ET for an informative (and free) webinar highlighting results of recent SLA Flash Surveys.  These surveys, which generate hundreds of responses, tap into the pulse of the financial aid community.  Participate in this webinar if you are interested in learning how your peers are reacting to this dynamic environment.

Who Made the Princeton Review's Financial Aid Honor Roll?

Given the obsession with college rankings, I thought I would feed into it (cmon, we all love lists) by providing the names of schools that made the Princeton Review's Financial Aid Honor Roll.  Each of the school's listed below received the highest rating score of 99:

Lawmakers Aren't The Only Busy Ones on Capitol Hill...

...So are Sallie Mae's lobbyists.  The Huffington Post scoured lobbying disclosures to highlight Sallie Mae's efforts to move their reform plan forward.  It appears that their original plan has morphed into the Student Loan Community Proposal, which would seem to have a nicer ring to it. 

The article details the well-connected lobbyists that SLM has hired on Capitol Hill with the almost $2 million (according to the article) that they have invested over the past six months:

Have We Learned Anything?

I am going a bit afield here away from student loans but couldn't contain my outrage.  This is madness!  Did you know you can get a mortgage from government-owned Fannie Mae with only 3% down?  This from the Wall Street Journal today: 

"Would-be homeowners have benefited from government programs, including one that allows buyers of properties owned by Fannie Mae to receive mortgages from the government-controlled mortgage-finance company with down payments as low as 3%."

Senator Brown (Dem-Ohio) Proposes Debt-Swap Plan to Refinance Private Student Loans

Here is the press release.  In an earlier post ("Will there eventually be a private loan refinancing boom?"), I had noted that the high margins on private loans today would open up a refinancing opportunity.  I had not thought that the government would step into this role, but what do you expect from an entrepreneur who expected that private capital would see the opportunity and step in?

Here are the details of Senator Brown's plan:

Vittana Brings Micro-Lending to Students Outside the U.S.

Think Kiva (which I have written about before) for student loans.  I have to admit that I am a sucker for social entrepreneurs with innovative business models.  The Seattle Times today has an article describing a non-profit called Vittana.  Here is what they do:

"Vittana offers loans to send a student to school for a year in Peru, Nicaragua or Paraguay for less than $1,000. It works through local microfinance institutions (MFIs) such as Fundacion Paraguaya, to administer the loans. The money cycles from the individual lender to Vittana to the MFI to the student and back. The MFI charges borrowers interest on the loan of about 10 to 15 percent APR to cover its operating costs."

A Quiet Day in Our Nation's Capital....Not

It would appear that as we get closer to the August recess, the proverbial "gloves are coming off" as both parties continued to search for "sound bites" and "score points" that would resonate with constituents.  The expectation now is that the House will tackle the Student Aid and Fiscal Responsibility soon after their return from the August break. 

Here goes: