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VOL. 23, NO. 12L
June 2006
Welcome to the June 2006 ISAC Update for Lenders and Servicers, which is a compilation of e-Messages sent through College Zone’s e-Messaging service throughout June. This e-Messaging service has replaced ISAC's use of printed newsletters and special e-mail lists as our primary means of communicating information to you.
The articles in this Update have been organized according to the Lender Zone subscription groups to which the messages were distributed via College Zone’s e-Messaging service.
Questions?
Questions regarding information in this ISAC Update can be directed to Lender Services by sending an e-mail message to lenderservices@isac.org or calling 800.899.ISAC (4722) and speaking with one of the following staff members:
- Sharon Bankston, extension 2826
- David Barinholtz, extension 2822
- Sondra Gardner, extension 2827
- Julie Henschel, extension 2823
On occasion, you may be directed to a specific contact person or area; when this occurs, we will provide the appropriate information in the individual article or message.
Multiple Subscription Groups
New Student Loan Interest Rates Effective July 1st
Sent to Marketing News, Announcements and Operational Updates, Announcements on June 2, 2006
The U.S. Department of Education (ED) has released two communications regarding the administration of Federal Family Education Loan Program (FFELP) loans, beginning on July 1, 2006.
- A May, 2006 Electronic Announcement itemizes the interest rates for fixed rate and variable rate Federal Stafford and PLUS loans, effective July 1, 2006.
Loans with first disbursements on or after July 1, 2006:
- 6.80% (fixed rate) for Federal Stafford subsidized and unsubsidized loans disbursed on or after July 1, 2006, during in-school, grace, repayment, deferment and forbearance periods
- 8.50% (fixed rate) for Federal PLUS loans disbursed on or after July 1, 2006
Loans with first disbursements between July 1, 1998 and June 30, 2006:
- 6.54% (variable rate through June 30, 2007) for Federal Stafford subsidized and unsubsidized loans during in-school, grace and deferment periods
- 7.14% (variable rate through June 30, 2007) for Federal Stafford subsidized and unsubsidized loans during repayment and forbearance periods
- 7.94% (variable rate through June 30, 2007) for Federal PLUS loans
For information about rates for loans disbursed prior to July 1, 1998, refer to the Electronic Announcement, or to College Zone's Interest Rates page.
- Dear Colleague Letter (DCL) FP-06-09 provides guidance for lenders' use in determining Federal Consolidation Loan Program interest rates from
July 1, 2006 through June 30, 2007. Due to the fact that many loans currently being consolidated carry variable interest rates that will increase significantly on July 1st, ED has given lenders the authority to use the lower of the weighted average of the interest rates on loans being consolidated as of July 1st or the date the lender receive the borrower's complete consolidation loan application. Additionally, as part of the DCL, ED included a statement regarding the issue of in-school student loan borrowers requesting consolidation. For more specific guidance, refer to the DCL.
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ISAC Update
Electronic ISAC Update for May 2006 Available at College Zone
Sent on June 1, 2006 The May 2006 edition of the ISAC Update is now available for your review within the ISAC Publications section of College Zone's e-Library. This version of the monthly electronic ISAC Update is a compilation of e-Messages sent to lenders and servicers in May via College Zone's e-Messaging service.
Topics covered in the May 2006 ISAC Update include:
- Information for Lenders: FFELP Stafford and PLUS MPNs Approved and Unreported Loan Rosters Mailed
(sent May 24, 2006)
- Commission Meeting to be Held Friday, June 16, 2006 (New Date)
(sent May 18, 2006)
- Mark Your Calendar for Upcoming Important Dates
(sent May 11, 2006)
- Updated Deferment Forms Released
(sent May 9, 2006)
- ISAC Budget & Legislative Update
(sent May 8, 2006)
- DCLs Regarding HERA Changes
(sent May 1, 2006)
- Electronic ISAC Update for April 2006 Available at College Zone
(sent May 1, 2006)
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