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Friday, December 22, 2006
Agency’s $650 million “asset redeployment” will make college more affordable for Illinois students
DEERFIELD, IL – The Illinois Student Assistance Commission today opened the bidding on the sale of about 15 percent of its student loan portfolio, a move designed to generate funds to pay for the Monetary Award Program (MAP) and new MAP Plus initiative, while making the agency more “Illinois-centric”.
Approximately $650 million in student loans now held by ISAC will be placed on the auction block. Many of these loans are to out-of-state students attending out-of-state colleges.
Respondents have until 12 p.m. eastern time (11 a.m. central time) on Friday, January 5, 2007, to place their bids. The deal should be completed by January 24, 2007, according to ISAC officials.
“After a thoughtful, deliberate process of analyzing ISAC’s assets, we have identified a specific portion of the $4.2 billion loan portfolio which could better serve Illinois students and taxpayers if it was in the hands of a different lender,” said ISAC Chairman Don McNeil. “This redeployment of assets enables ISAC to immediately fund MAP and MAP Plus.”
Legislation creating MAP Plus was signed into law by Governor Rod Blagojevich in July, 2006, to directly aid college students from middle-income families. MAP Plus provides up to $500 to each college sophomore, junior and senior not receiving the need-based MAP (Monetary Award Program), and attends a MAP-eligible school during the 2006-07 school year.
Funding for MAP Plus - projected at $34.4 million for 70,000 middle-income students - will come from this sale. The same bill that created MAP Plus also increased funding for the need-based MAP program by $34.4 million more than the increase originally included in the Governor’s proposed budget.
“This year’s increase to MAP funding was the largest in the history of MAP,” McNeil said. “The Governor and legislative leaders didn’t forget about students with the greatest financial need while finding a way to give significant relief to middle-income families as well.”
Agency officials are confident that any revenue-generating transactions approved by ISAC will not jeopardize the agency’s scholarship and grant administration or student outreach and counseling activities. Further, current borrowers whose loans are sold will be protected from losing any benefits offered in their original loan deal with ISAC.
“This sale protects the borrowers, benefits Illinois students and redefines ISAC in an increasingly competitive student loan industry,” McNeil said. “This is an opportune time for ISAC to gradually exit the business of helping students from Utah to attend college in Boston. We want to keep good Illinois students right here in Illinois.”
Portfolio Sale Bid Form
Confidentiality Agreement
Contact
Illinois Student Assistance Commission (ISAC)
100 W. Randolph Street, Ste. 3-200
Chicago, IL 60601
312-814-3679
About ISAC
The Illinois Student Assistance Commission is the State’s centralized provider of financial assistance aimed at helping students and families access postsecondary education and/or training. Each year, the Commission awards an estimated $400 million in scholarship and grant aid to nearly 185,000 qualified students, and also provides an additional $740 million to borrowers through its student loan programs. The agency offers credit-based alternative loans, a 529 prepaid tuition program known as College Illinois!, and a broad array of outreach and informational services to ensure that families have access to the information they need to pay for a college education. More information is available by calling toll-free 800.899.ISAC (4722) or visiting the agency’s Web site at www.collegezone.com.
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