SFA Information for Financial Aid Professionals
U.S. Department of Education
| Quarter: 12/31/99 December 29, 1999 TO : Regional Directors FFEL Program Section Staff FROM : Acting Chief, FFEL Program Section Division of Program Development Analysis Service SUBJECT : Federal Family Education Loan Program Special Allowance Rates for the Quarter Ending December 31, 1999 The Treasury Department has informed me that the average of the bond equivalent rates of the ninety-one day Treasury bills auctioned during the quarter ending December 31, 1999, is 5.22 percent. Attachment A contains the bond equivalent rates of the 91-day Treasury Bills auctioned during the quarter. Attachments B & C contain the quarterly special allowance rates computed pursuant to section 438 of the Higher Education Act of 1965, as amended (the Act). [signed] Patricia Newcombe Attachments File Size: 34KB; Number of Pages: 11 Requires 4.0 or greater of the free Adobe Acrobat Reader software. Attachment A - 91-Day Treasury Bills (Quarter Ending 12/31/99)
Attachment B - Regular Special Allowance Rates (Quarter Ending 12/31/99) Attachment B Includes: Loans made or purchased with (a) funds obtained by the holder from the issuance, or refinancing, of obligations originally issued on/after 10/1/93, or (b) funds derived from default reimbursements, collections, interest, or other income resulting from loans made or purchased with such tax-exempt funds. I. -- Stafford (subsidized and unsubsidized), PLUS (fixed-rate; includes student-borrower component of the PLUS Program), and Consolidation loans: made prior to 10/1/81. Formula: (5.22) plus (3.5%) less (applicable interest rate), rounded up to the nearest 1/8th of 1% = annual special allowance rate.
__________________________ * The Special Allowance at Annual Rate and Special Allowance for 3-month Period figures are shown as decimals throughout this memo, e.g., 0.5% (one-half of one percent) is shown as .005", 1.5% (one and one-half percent) is shown as .015", etc. II. -- Stafford (subsidized only) and PLUS (fixed-rate, includes student borrower component of the PLUS program) loans: made on/after 10/1/81, but prior to 10/17/86. made on/after 10/17/86, but prior to 11/16/86, for periods of enrollment beginning prior to 11/16/86. -- Consolidation loans: made on/after 10/1/81, but prior to 11/16/86. -- Also, certain taxable obligations of South Carolina and Maine. Formula: (5.22%) plus (3.5%) less (applicable interest rate) = annual special allowance rate.
III. -- Stafford loans: (subsidized) made on/after 10/17/86, but prior to 11/16/86, for periods of enrollment beginning on/after 11/16/86. (subsidized) made on/after 11/16/86, but prior to 10/1/92. (unsubsidized, made pursuant to 428H of the Act) made prior to 10/1/92 for periods of enrollment beginning on/after 10/1/92. -- PLUS/SLS loans: (fixed-rate) made on/after 10/17/86, but prior to 11/16/86, for periods of enrollment beginning on/after 11/16/86. (fixed-rate) made on/after 11/16/86, but prior to 7/1/87. (variable-rate) made on/after 7/1/87, but prior to 10/1/92, only if the variable-rate for each July 1 - June 30 period reaches the statutory maximum of 12%. -- Consolidation loans: made on/after 11/16/86, but prior to 10/1/92. Formula: (5.22%) plus (3.25%) less (applicable interest rate) = annual special allowance rate.
Also included for the period 7/1/99 - 6/30/2000 (Fixed-rate Stafford loans that were subject to the "windfall profits" provisions of 427A(i)(3) or 427A(i)(1) of the Act and that have been converted to a variable rate): 1 Fixed-rate 7% Stafford loans (1992 Amendments). 2 (a) Fixed-rate 8% and 9% Stafford loans (b) 8/10% Stafford loans (on/after the 49th month of repayment) (1992 Amendments) and (c) 8/10% Stafford loans (prior to the 49th month of repayment) (1992 Amendments). 3 Fixed-rate 8/10% Stafford loans (on/after the 49th month of repayment) (1986 Amendments). See 427A(i)(7)(D) of the Act. IV. -- Stafford loans: (subsidized) made on/after 10/1/92, but prior to 7/1/95. (unsubsidized) made on/after 10/1/92, but prior to 7/1/95, for periods of enrollment beginning on/after 10/1/92. (subsidized and unsubsidized) made on/after 7/1/95 but prior to 7/1/98, except during the in-school, grace, and deferment periods. -- PLUS/SLS loans: (variable-rate) made on/after 10/1/92 but prior to 7/1/94, only if the variable-rate for each July 1 - June 30 period reaches the statutory maximum of 11% (SLS) or 10% (PLUS). -- PLUS loans: (variable-rate) made on/after 7/1/94 but prior to 7/1/98. (variable-rate) made on/after 7/1/98 but prior to 7/1/03 (special allowance shall not be paid unless the calculated interest rate exceeds the 9% cap). -- Consolidation loans: made on/after 10/1/92. Formula: (5.22%) plus (3.1%) less (applicable interest rate) = annual special allowance rate.
[continued...] 4 The 6% interest and special allowance rates only apply to Consolidation loans made on/after 7/1/94 with tax-exempt funds; the 10%, 11%. 13% and 14% interest and special allowance rates only apply to Consolidation loans made with tax-exempt funds. Also included for the period 7/1/99 - 6/30/2000 (Fixed-rate Stafford loans that were subject to the "windfall profits" provisions of 427A(i)(3) of the Act and that have been converted to a variable rate): 5 Fixed-rate 7% Stafford loans (1992 Amendments). See 427A(i)(7)(D) of the Act. IV. [...continued]
For the period 7/1/99 - 6/30/2000: 6 (a) All Stafford loans made for periods of enrollment that either begin on/after 7/1/94 or include that date for which the first disbursement is made on/after 7/1/94 but prior to 7/1/95 (b) Stafford loans for which the first disbursement is made on/after 7/1/95 and before 7/1/98, except during the in-school, grace & deferment periods (c) Stafford loans, made to new borrowers, for which the first disbursement is made on/after 10/1/92 but prior to 7/1/94, and (d) fixed-rate 8% and 9% Stafford loans that were subject to the "windfall profits" provisions of 427A(i)(3) of the Act and that have been converted to a variable rate; see 427A(i)(7)(D) of the Act and (e) 8/10% Stafford loans (on/after the 49th month of repayment) and 8/10% Stafford loans (prior to the 49th month of repayment) that were subject to the windfall profits provisions of 427A(i)(3) of the Act and that have been converted to a variable rate (1992 Amendments). 7 PLUS loans made on/after 7/1/94 but prior to 7/1/98. V. -- Stafford loans (subsidized and unsubsidized): made on/after 7/1/95 but prior to 7/1/98, only during the in-school, grace, and deferment periods. Formula: (5.22%) plus (2.5%) less (applicable interest rate) = annual special allowance rate.
VI. --Stafford loans (subsidized and unsubsidized): made on/after 7/1/98 but prior to 7/1/03 only during the in-school, grace, and deferment periods. Formula: (5.22%) plus (2.2%) less (applicable interest rate) = special allowance rate.
VII. --Stafford loans (subsidized and unsubsidized): made on/after 7/1/98 but prior to 7/1/03, except during the in-school, grace, and deferment periods. Formula: (5.22%) plus (2.8%) less (applicable interest rate) = special allowance rate.
Attachment C - Special Allowance Rates (Quarter Ending 12/31/99) Attachment C Includes: Loans made or purchased with (a) funds obtained by the holder from the issuance, or refinancing, or obligations originally issued prior to 10/1/93, or (b) funds derived from default reimbursements, collections, interest, or other income resulting from loans made or purchased with such tax-exempt funds. I. -- Tax-exempt loans, otherwise eligible for special allowance, made on/after 10/1/80, but prior to 10/1/81. Formula: (5.22%) plus (3.5%) less (applicable interest rate), rounded up to the nearest 1/8th of 1%, divided by two = annual special allowance rate, however the annual special allowance rate is not less than 2.5% (for 7% loans) and 0.5% (for 9% loans).
II. -- Tax-exempt loans, otherwise eligible for special allowance, made on/after 10/1/81. Formula: (5.22%) plus (3.5%) less (applicable interest rate), divided by two = annual special allowance rate, however the annual special allowance rate is not less than: For loans made prior to 10/1/92, 2.5% (for 7% loans), 1.5% (for 8% loans), and 0.5% (for 9% loans). For loans made on/after 10/1/92, 9.5% less the applicable interest rate.
[continued...] 8 The 6% interest and special allowance rates only apply to Consolidation loans made on/after 7/1/94 with tax-exempt funds; the 10%, 11%. 13% and 14% interest and special allowance rates only apply to Consolidation loans made with tax-exempt funds. 9 For the period 7/1/99 - 6/30/2000: Stafford loans made on/after 7/1/98 but prior to 7/1/03, only during the in-school, grace, and deferment periods. 10 For the period 7/1/99 - 6/30/2000: Stafford loans made on/after 7/1/98 but prior to 7/1/03, except during the in-school, grace and deferment periods. 11 Also included for the period 7/1/99 - 6/30/2000: Fixed-rate 7% Stafford loans that were subject to the "windfall profits" provisions of 427A(i)(3) of the Act and that have been converted to a variable rate, see 427A(i)(7)(D) of the Act. 12 For the period 7/1/99 - 6/30/2000: Stafford loans for which the first disbursement is made on/after 7/1/95 and before 7/1/98, only during the in-school, grace, and deferment periods. . Attachment C - Special Allowance Rates (Quarter Ending 12/31/99) II. [...continued]
For the period 7/1/99 - 6/30/2000: 13 (a) All Stafford loans made for periods of enrollment that either begin on/after 7/1/94 or include that date for which the first disbursement is made on/after 7/1/94 but prior to 7/1/95 (b) Stafford loans for which the first disbursement is made on/after 7/1/95 but prior to 7/1/98, except during the in-school, grace & deferment periods (c) Stafford loans, made to new borrowers, for which the first disbursement is made on/after 10/1/92 but prior to 7/1/94 (d) fixed-rate 8% and 9% Stafford loans and that were subject to the "windfall profits" provisions of 427A(i)(3) of the Act and that have been converted to a variable rate; see 427A(i)(7)(D) of the Act and (e) 8/10% Stafford loans (on/after the 49th month of repayment) and 8/10% Stafford loans (prior to the 49th month of repayment) that were subject to the "windfall profits" provisions of 427A(i)(3) of the Act and that have been converted to a variable rate (1992 Amendments). 14 Fixed-rate 8/10% Stafford loans that were subject to the "windfall profits" provisions of 427A(i)(1) of the Act and that have been converted to a variable rate; see 427A(i)(7)(D) of the Act (1986 Amendments) 15 PLUS loans made on/after 7/1/94 but prior to 7/1/98. |