Student Lending Analytics Blog

In Defense of a Focused Lender List (Redux) And The $600 Million Question

So, there I was at 30,000 feet, a little cranky because they didn't have any snacks on board my United Flight, forcing me to ingest my third CLIF bar of the day (Cool Mint Chocolate in case you were wondering) while thinking about what to do next since the battery on my laptop ran down two hours outside of San Francisco.  The answer was staring me in the face.  I had lugged all 137 pages of it in hopes of preparing for a future webinar (more on this next week).  Yes, the dreaded Notice of Proposed Rulemaking with that oh so enticing subject line:  "Institutions and Lender Requirements Relating to Education Loans, Student Assistance General Provisions, Federal Perkins Loan Program, Federal Family Education Loan Program, and William D. Ford Federal Direct Loan Program; Proposed Rule."  Phew. 

So, I grabbed my highlighter and went to work fastidiously underlining, scribbling notes in the margin, envisioning Powerpoint slides in my head (did I just admit that?) and just about having the best time possible filling my head with all this information.  Did you know the government is estimating the self-certification form will burden schools to the tune of about 1,100,008 hours? 

And then it hit me like a sledgehammer on page 74: 

ITT Asks ED To Require that School and Lender Acknowledge Preferred Lender Arrangement

Here is ITT Educational Services' comments on the Notice of Proposed Rulemaking (NPRM):

The proposed definition of "preferred lender arrangement," lacks a requirement that there be a meeting of the minds between a lender and a covered institution or institution-affiliated organization with respect to whether a preferred lender arrangement exists.  This requirement is important, because a preferred lender arrangement triggers a number of reporting and disclosure obligations by both the covered institution or institution-affiliated organization and the lender under 601.01, .20, .21 and .40 of the proposed rule.  Material portions of the information required in those reports and disclosures will not be prepared or consistent, unless both the covered institution or institution-affiliated organization and the lender acknowledge that a preferred lender arrangement exists..."

Interesting Disclosures on School Lender Lists

As part of my focus on lender lists recently, I came across these disclosures which increase transparency of the lender selection process or provide additional information that can be useful for students (please send me any additional ideas that you would like for me to post): 

• Skidmore College provided the specific reasons that they selected individual lenders.   Here is why they selected two of the lenders on their list: