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Update #8: Direct Consolidation Loan

PublicationDate: 11/21/97
Summary: Update #8: Direct Consolidation Loan
Author: ODAS - Office of the Deputy Assistant Secretary - SFA

Consolidation Update Eight

November 21, 1997

Dear Colleagues:

I am pleased to provide current information about our progress in processing Direct
Loan consolidation applications as we move towards our goal of re-opening the Loan
Consolidation Center to new applications beginning next month.

As you may know, the Student Loan Marketing Association (Sallie Mae) has announced
a temporary suspension of new consolidation loan processing. The Department is
consulting with other FFEL consolidation lenders concerning their current capacity and
interest in increasing the number of consolidation applications. There remain other
participants in the lending community who appear able and willing to offer consolidation
options to interested borrowers. We believe that applicants for consolidation will
continue to be assisted.

Please see the data below for the current status of application at our Direct Loan
Consolidation Center:

Status: As of 11/12/97 As of 11/17/97

I. Applications Consolidated (completed) 92,722 94,260
Applications Withdrawn/Deactivated 39,384 39,821
Applications in Process 10,750 8,775

II. Breakdown of Current Applications*:

Applications in Pre-Certification
Review stage (incomplete application) 0 0

Applications in Certification of Loan
Amounts Stage (awaiting loan holder
information): 248 135

Applications in Promissory Note Review 57 43

Applications in Promissory Note Stage 6,606 4,781

*In addition to the current applications, there are 3,816 reactivated applications which
were, at one time, deactivated and are included in item I above as Applications in

I look forward to providing future updates and sharing with you our plans for re-opening
the Loan Consolidation Center to new applications.

Respectfully submitted,

Elizabeth M. Hicks
Deputy Assistant Secretary
Student Financial Assistance Programs

Last Modified: 08/16/1999