Exhibit 99.1

 

ANNEX A

The Trust Student Loan Pool as of October 31, 2017

 

The trust student loans owned by the trust were originally selected from a portfolio of consolidation student loans owned by Student Loan Marketing Association by employing several criteria, including requirements that each trust student loan as of the original cutoff date:

 

·

was guaranteed as to principal and interest by a guaranty agency under a guarantee agreement and the guaranty agency was, in turn, reinsured by the Department of Education in accordance with the FFELP;

 

·

contained terms in accordance with those required by the FFELP, the guarantee agreements and other applicable requirements;

 

·

was more than 120 days past the final disbursement;

 

·

was not more than 210 days past due;

 

·

did not have a borrower who was noted in the related records of the servicer as being currently involved in a bankruptcy proceeding; and

 

·

had special allowance payments, if any, based on the three-month commercial paper rate or the 91-day Treasury bill rate.

No trust student loan as of the original cutoff date was subject to the depositor’s

or the Student Loan Marketing Association’s prior obligation to sell that loan to a third

party. The Student Loan Marketing Association was dissolved on December 31, 2004

and all of its obligations were assumed by its affiliate, Navient Credit Finance Corporation.

Unless otherwise specified, all information with respect to the trust student loans is presented as of October 31, 2017, which is the statistical disclosure date.

The following tables provide a description of specified characteristics of the trust student loans as of the statistical disclosure date.  The aggregate outstanding principal balance of the loans in each of the following tables includes the principal balance due from borrowers, plus accrued interest of $2,277,964 to be capitalized as of the statistical disclosure date.  Percentages and dollar amounts in any table may not total 100% or whole dollars due to rounding.  The following tables also contain information concerning the total number of loans and total number of borrowers in the portfolio of trust student loans.  For ease of administration, the servicer separates a consolidation loan on its system into two separate loan segments representing subsidized and unsubsidized segments of the same loan.  The following tables reflect those loan segments within the number of loans.  In addition, 1 borrower has more than one trust student loan.

The distribution by weighted average interest rate applicable to the trust student loans on any date following the statistical disclosure date may vary significantly from that in the following tables as a result of variations in the effective rates of interest applicable to the trust student loans and in rates of principal reduction.  Moreover, the information below about the weighted average remaining term to maturity of the trust student loans as of the statistical disclosure date may vary significantly from the actual term to maturity of any of the trust student loans as a result of prepayments or the granting of deferment and forbearance periods.

 

The following tables also contain information concerning the total number of loans and the total number of borrowers in the portfolio of trust student loans.

 

Percentages and dollar amounts in any table may not total 100% of the trust student loan balance, as applicable, due to rounding.

COMPOSITION OF THE TRUST STUDENT LOANS AS OF

THE STATISTICAL DISCLOSURE DATE

Aggregate Outstanding Principal Balance		$	600,500,501
Aggregate Outstanding Principal Balance – Treasury Bill		$	81,606,782
Percentage of Aggregate Outstanding Principal Balance – Treasury Bill			13.59	%
Aggregate Outstanding Principal Balance – One-Month LIBOR		$	518,893,719
Percentage of Aggregate Outstanding Principal Balance – One-Month LIBOR			86.41	%
Number of Borrowers			18,902
Average Outstanding Principal Balance Per Borrower		$	31,769
Number of Loans			32,881
Average Outstanding Principal Balance Per Loan – Treasury Bill		$	30,610
Average Outstanding Principal Balance Per Loan – One-Month LIBOR		$	17,1733
Weighted Average Remaining Term to Scheduled Maturity		176 months
Weighted Average Annual Interest Rate			6.15	%

 

We determined the weighted average remaining term to maturity shown in the table from the statistical disclosure date to the stated maturity date of the applicable trust student loan without giving effect to any deferment or forbearance periods that may be granted in the future.  See Appendix A to the preliminary remarketing memorandum.

The weighted average annual borrower interest rate shown in the table is exclusive of special allowance payments.  The weighted average spread for special allowance payments to the 91-day Treasury bill rate was 3.10% as of the statistical disclosure date.

The weighted average spread for special allowance payments to the one-month LIBOR rate was 2.64% as of the statistical disclosure date.  See “Special Allowance Payments” in Appendix A to the preliminary remarketing memorandum.

For these purposes, the 91-day Treasury bill rate is the weighted average per annum discount rate, expressed on a bond equivalent basis and applied on a daily basis, for direct obligations of the United States with a maturity of thirteen weeks, as reported by the U.S. Department of the Treasury.

 

DISTRIBUTION OF THE TRUST STUDENT LOANS

BY BORROWER INTEREST RATES AS OF THE STATISTICAL

DISCLOSURE DATE

Interest Rates		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Less than or equal to 3.00%			0			$	0				0.0	%
3.01% to 3.50%			564				6,806,371				1.1
3.51% to 4.00%			1,195				21,921,063				3.7
4.01% to 4.50%			6,132				75,936,606				12.6
4.51% to 5.00%			9,219				136,647,461				22.8
5.01% to 5.50%			1,635				29,959,666				5.0
5.51% to 6.00%			1,472				26,360,037				4.4
6.01% to 6.50%			2,442				44,750,369				7.5
6.51% to 7.00%			3,973				78,915,959				13.1
7.01% to 7.50%			992				21,678,082				3.6
7.51% to 8.00%			2,049				54,693,590				9.1
8.01% to 8.50%			2,349				67,865,547				11.3
Equal to or greater than 8.51%			859				34,965,751				5.8
Total			32,881			$	600,500,501				100.0	%

 

We determined the interest rates shown in the table above using the interest rates applicable to the trust student loans as of the statistical disclosure date.  Because trust student loans with different interest rates are likely to be repaid at different rates, this information is not likely to remain applicable to the trust student loans after the statistical disclosure date.  See Appendix A to the preliminary remarketing memorandum and “The Student Loan Pools – Sallie Mae’s Student Loan Financing Business” in the original prospectus.

 

DISTRIBUTION OF THE TRUST STUDENT LOANS BY

OUTSTANDING PRINCIPAL BALANCE PER BORROWER

AS OF THE STATISTICAL DISCLOSURE DATE

 

Range of Outstanding Principal Balance				Number of Borrowers				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Less than $5,000.00					2,503			$	6,518,952				1.1	%
$	5,000.00-$ 9,999.99				3,417				25,447,276				4.2
$	10,000.00-$14,999.99				2,120				26,150,005				4.4
$	15,000.00-$19,999.99				1,719				29,993,746				5.0
$	20,000.00-$24,999.99				1,508				33,762,430				5.6
$	25,000.00-$29,999.99				1,180				32,313,228				5.4
$	30,000.00-$34,999.99				941				30,414,517				5.1
$	35,000.00-$39,999.99				792				29,646,690				4.9
$	40,000.00-$44,999.99				698				29,669,457				4.9
$	45,000.00-$49,999.99				527				24,985,055				4.2
$	50,000.00-$54,999.99				467				24,512,570				4.1
$	55,000.00-$59,999.99				426				24,448,303				4.1
$	60,000.00-$64,999.99				293				18,327,699				3.1
$	65,000.00-$69,999.99				242				16,349,318				2.7
$	70,000.00-$74,999.99				241				17,472,928				2.9
$	75,000.00-$79,999.99				216				16,762,345				2.8
$	80,000.00-$84,999.99				178				14,658,682				2.4
$	85,000.00-$89,999.99				167				14,579,655				2.4
$	90,000.00-$94,999.99				128				11,859,340				2.0
$	95,000.00-$99,999.99				118				11,509,168				1.9
$100,000.00 and above					1,021				161,119,137				26.8
Total					18,902			$	600,500,501				100.0	%

 

DISTRIBUTION OF THE TRUST STUDENT LOANS

BY DELINQUENCY STATUS AS OF THE

STATISTICAL DISCLOSURE DATE

 

Number of Days Delinquent		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
0-30 days			31,507			$	560,003,286				93.3	%
31-60 days			491				12,828,817				2.1
61-90 days			278				8,587,258				1.4
91-120 days			140				4,025,196				0.7
121-150 days			109				3,739,244				0.6
151-180 days			73				2,347,761				0.4
181-210 days			86				2,594,326				0.4
Greater than 210 days			197				6,374,613				1.1
Total			32,881			$	600,500,501				100.0	%

 

DISTRIBUTION OF THE TRUST STUDENT LOANS

BY REMAINING TERM TO SCHEDULED MATURITY

AS OF THE STATISTICAL DISCLOSURE DATE

 

Number of Months Remaining to Scheduled Maturity		Number of Loans					Aggregate Outstanding Principal Balance			Percent of Pool by Outstanding Principal Balance
0 to 3			106			$	29,448				*
4 to 12			551				471,781				0.1	%
13 to 24			910				1,728,309				0.3
25 to 36			1,019				3,604,374				0.6
37 to 48			1,016				5,229,222				0.9
49 to 60			4,350				19,940,069				3.3
61 to 72			2,341				14,825,355				2.5
73 to 84			1,506				12,870,497				2.1
85 to 96			1,284				13,926,718				2.3
97 to 108			1,119				13,630,169				2.3
109 to 120			3,299				39,692,958				6.6
121 to 132			2,588				48,886,166				8.1
133 to 144			1,797				42,296,595				7.0
145 to 156			1,363				34,364,394				5.7
157 to 168			1,092				29,188,607				4.9
169 to 180			2,878				72,190,987				12.0
181 to 192			1,358				40,087,590				6.7
193 to 204			891				31,773,233				5.3
205 to 216			705				26,451,723				4.4
217 to 228			519				19,951,030				3.3
229 to 240			591				27,251,901				4.5
241 to 252			401				18,639,948				3.1
253 to 264			255				13,325,573				2.2
265 to 276			209				12,051,547				2.0
277 to 288			156				8,891,655				1.5
289 to 300			178				11,514,743				1.9
301 to 312			147				14,397,211				2.4
313 to 324			68				5,547,712				0.9
325 to 336			28				2,441,070				0.4
337 to 348			42				4,038,798				0.7
349 to 360			76				7,966,831				1.3
361 and above			38				3,294,285				0.5
Total			32,881			$	600,500,501				100.0	%

 

*	Represents a percentage greater than 0% but less than 0.05%.

We have determined the number of months remaining to scheduled maturity shown in the table from the statistical disclosure date to the stated maturity date of the applicable trust student loan without giving effect to any deferment or forbearance periods that may be granted in the future.  See Appendix A to the preliminary remarketing memorandum and “The Student Loan Pools –Sallie Mae’s Student Loan Financing Business” in the original prospectus.

 

DISTRIBUTION OF THE TRUST STUDENT LOANS

BY CURRENT BORROWER PAYMENT STATUS

AS OF THE STATISTICAL DISCLOSURE DATE

 

Current Borrower Payment Status		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Deferment			1,042			$	24,228,094				4.0	%
Forbearance			2,188				63,236,247				10.5
Repayment
First year in repayment			298				16,487,876				2.7
Second year in repayment			283				14,320,224				2.4
Third year in repayment			333				14,801,558				2.5
More than 3 years in repayment			28,737				467,426,503				77.8
Total			32,881			$	600,500,501				100.0	%

 

Current borrower payment status refers to the status of the borrower of each trust student loan as of the statistical disclosure date.  The borrower:

·

may have temporarily ceased repaying the loan through a deferment or a forbearance period; or

·

may be currently required to repay the loan – repayment.

See Appendix A to the preliminary remarketing memorandum and “The Student Loan Pools –Sallie Mae’s Student Loan Financing Business” in the original prospectus.

The weighted average number of months in repayment for all trust student loans currently in repayment is approximately 125.1 calculated as the term to maturity at the commencement of repayment less the number of months remaining to scheduled maturity as of the statistical disclosure date.

 

SCHEDULED WEIGHTED AVERAGE REMAINING MONTHS IN

STATUS OF THE TRUST STUDENT LOANS BY

CURRENT BORROWER PAYMENT STATUS AS OF THE

STATISTICAL DISCLOSURE DATE

		Scheduled Months in Status Remaining
Current Borrower Payment Status		Deferment				Forbearance				Repayment
Deferment			19.1				-				209.5
Forbearance			-				4.1				197.6
Repayment			-				-				169.8

We have determined the scheduled weighted average remaining months in status shown in the previous table without giving effect to any deferment or forbearance periods that may be granted in the future.  Of the $24,228,094 aggregate outstanding principal balance of the trust student loans in deferment as of the statistical disclosure date, $17,215,215 or approximately 71.1% of such loans are to borrowers who had not graduated as of that date.  We expect that a significant portion of these loans could qualify for additional deferments or forbearances at the end of their current deferment periods as the related borrowers continue their education beyond their current degree programs.  As a result, the overall duration of any applicable deferment and forbearance periods as well as the likelihood of future deferment and forbearance periods within this pool of trust student loans is likely to be higher than in other pools of student loans without similar numbers of in-school consolidation loans.  See Appendix A to the original prospectus.

 

GEOGRAPHIC DISTRIBUTION OF THE TRUST STUDENT LOANS

AS OF THE STATISTICAL DISCLOSURE DATE

 

State		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Alabama			233			$	4,735,322				0.8	%
Alaska			42				603,828				0.1
Arizona			665				13,750,925				2.3
Arkansas			179				3,144,910				0.5
California			3,697				71,321,618				11.9
Colorado			546				8,232,429				1.4
Connecticut			519				7,910,154				1.3
Delaware			87				1,545,252				0.3
District of Columbia			129				3,135,234				0.5
Florida			1,896				42,643,933				7.1
Georgia			1,202				28,027,957				4.7
Hawaii			72				1,314,723				0.2
Idaho			108				1,908,558				0.3
Illinois			1,517				23,962,244				4.0
Indiana			469				6,343,943				1.1
Iowa			214				3,659,087				0.6
Kansas			533				8,838,283				1.5
Kentucky			212				4,154,172				0.7
Louisiana			897				16,942,115				2.8
Maine			105				2,112,117				0.4
Maryland			949				19,674,636				3.3
Massachusetts			1,080				14,957,955				2.5
Michigan			801				16,192,447				2.7
Minnesota			595				9,815,508				1.6
Mississippi			299				6,031,652				1.0
Missouri			751				13,452,223				2.2
Montana			54				1,072,293				0.2
Nebraska			56				1,089,601				0.2
Nevada			232				4,892,922				0.8
New Hampshire			128				1,966,226				0.3
New Jersey			861				15,547,639				2.6
New Mexico			135				3,141,911				0.5
New York			2,379				41,132,232				6.8
North Carolina			824				14,386,747				2.4
North Dakota			15				202,328				*
Ohio			159				2,811,923				0.5
Oklahoma			812				14,750,803				2.5
Oregon			643				11,022,855				1.8
Pennsylvania			1,096				20,079,942				3.3
Rhode Island			105				2,025,920				0.3
South Carolina			391				8,399,244				1.4
South Dakota			33				382,426				0.1
Tennessee			558				10,899,879				1.8
Texas			3,343				57,836,037				9.6
Utah			119				2,005,234				0.3
Vermont			51				720,511				0.1
Virginia			1,060				17,436,040				2.9
Washington			1,128				18,031,027				3.0
West Virginia			133				2,114,428				0.4
Wisconsin			431				8,480,272				1.4
Wyoming			33				266,778				*
Other			305				5,394,057				0.9
Total			32,881			$	600,500,501				100.0	%

 

*	Represents a percentage greater than 0% but less than 0.05%.

 

We have based the geographic distribution shown in the table on the billing addresses of the borrowers of the trust student loans shown on the servicer’s records as of the statistical disclosure date.

Each of the trust student loans provides or will provide for the amortization of its outstanding principal balance over a series of regular payments.  Except as described below, each regular payment consists of an installment of interest which is calculated on the basis of the outstanding principal balance of the trust student loan.  The amount received is applied first to interest accrued to the date of payment and the balance of the payment, if any, is applied to reduce the unpaid principal balance.  Accordingly, if a borrower pays a regular installment before its scheduled due date, the portion of the payment allocable to interest for the period since the preceding payment was made will be less than it would have been had the payment been made as scheduled, and the portion of the payment applied to reduce the unpaid principal balance will be correspondingly greater.  Conversely, if a borrower pays a monthly installment after its scheduled due date, the portion of the payment allocable to interest for the period since the preceding payment was made will be greater than it would have been had the payment been made as scheduled, and the portion of the payment applied to reduce the unpaid principal balance will be correspondingly less.

In either case, subject to any applicable deferment periods or forbearance periods, and except as provided below, the borrower pays a regular installment until the final scheduled payment date, at which time the amount of the final installment is increased or decreased as necessary to repay the then outstanding principal balance of that trust student loan.

The servicer makes available to borrowers of student loans it holds (including the trust student loans) payment terms that may result in the lengthening of the remaining term of the student loans.  For example, not all of the loans sold to the trust provide for level payments throughout the repayment term of the loans.  Some student loans provide for interest only payments to be made for a designated portion of the term of the loans, with amortization of the principal of the loans occurring only when payments increase in the latter stage of the term of the loans.  Other loans provide for a graduated phase in of the amortization of principal with a greater portion of principal amortization being required in the latter stages than would be the case if amortization were on a level payment basis.  The servicer also offers an income-sensitive repayment plan, under which repayments are based on the borrower’s income.  Under that plan, ultimate repayment may be delayed up to five years.  Borrowers under trust student loans will continue to be eligible for the graduated payment and income-sensitive repayment plans.  These programs are applicable to the trust student loans and may be offered by the servicer to related borrowers at its discretion.

 

The following table provides certain information about trust student loans subject to the repayment terms described in the preceding paragraphs.

DISTRIBUTION OF THE TRUST STUDENT LOANS BY REPAYMENT

TERMS AS OF THE STATISTICAL DISCLOSURE DATE

 

Loan Repayment Terms		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Level Repayment			17,062			$	240,510,618				40.1	%
Other Repayment Options(1)			13,014				252,222,290				42.0
Income-driven Repayment(2)			2,805				107,767,594				17.9
Total			32,881			$	600,500,501				100.0	%

 

(1)	Includes, among others, graduated repayment and interest-only period loans.

(2)	Includes income sensitive and income based repayment.

 

With respect to interest-only loans, as of the statistical disclosure date, there are 439 loans with an aggregate outstanding principal balance of $19,905,367 currently in an interest-only period.  These interest-only loans represent approximately 3.3% of the aggregate outstanding principal balance of the trust student loans.  Interest-only periods range up to 48 months in overall length.

The servicer may in the future offer repayment terms similar to those described above to borrowers of trust student loans who are not entitled to these repayment terms as of the statistical disclosure date.  If repayment terms are offered to and accepted by those borrowers, the weighted average life of the securities could be lengthened.

DISTRIBUTION OF THE TRUST STUDENT LOANS BY LOAN

TYPE AS OF THE STATISTICAL DISCLOSURE DATE

 

Loan Type		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
Subsidized			16,275			$	259,982,968				43.3	%
Unsubsidized			16,606				340,517,533				56.7
Total			32,881			$	600,500,501				100.0	%

---

Disbursement Date		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
September 30, 1993 and earlier			80			$	2,389,571				0.4	%
October 1, 1993 through June 30, 2006			32,801				598,110,930				99.6
July 1, 2006 and later			0				0				0.0
Total			32,881			$	600,500,501				100.0	%

 

Guaranty Agencies for the Trust Student Loans.  The eligible lender trustee has entered into a separate guarantee agreement with each of the guaranty agencies listed below, under which each of the guarantors has agreed to serve as guarantor for specified trust student loans.

The following table provides information with respect to the portion of the trust student loans guaranteed by each guarantor.

 

DISTRIBUTION OF THE TRUST STUDENT LOANS

BY GUARANTY AGENCY AS OF

THE STATISTICAL DISCLOSURE DATE

Name of Guaranty Agency		Number of Loans				Aggregate Outstanding Principal Balance				Percent of Pool by Outstanding Principal Balance
American Student Assistance			1,771			$	22,466,250				3.7	%
College Assist			17				328,119				0.1
Educational Credit Management Corporation			1,078				20,222,381				3.4
Great Lakes Higher Education Corporation			546				12,427,790				2.1
Illinois Student Assistance Comm			1,435				20,565,779				3.4
Kentucky Higher Educ. Asst. Auth.			118				2,419,267				0.4
Louisiana Office Of Student Financial Asst			356				4,717,894				0.8
Michigan Guaranty Agency			581				9,647,428				1.6
New Jersey Higher Ed Student Assistance Authority			739				9,891,689				1.6
New York State Higher Ed Services Corp			3,250				51,648,629				8.6
Northwest Education Loan Association			3,318				49,882,567				8.3
Oklahoma Guaranteed Stud Loan Prog			849				13,492,177				2.2
Pennsylvania Higher Education Assistance Agency			2,706				46,745,959				7.8
Texas Guaranteed Student Loan Corp			2,901				50,605,956				8.4
United Student Aid Funds, Inc.			13,216				285,438,616				47.5
Total			32,881			$	600,500,501				100.0	%

 

SIGNIFICANT GUARANTOR INFORMATION

The information shown for the Significant Guarantor relates to all student loans, including but not limited to trust student loans, guaranteed by the Significant Guarantor.

We obtained the following information from various sources, including from the Significant Guarantor and/or from the Department of Education.  None of the depositor, Navient CFC, the servicer, their affiliates or the remarketing agent has audited or independently verified this information for accuracy or completeness.

UNITED STUDENT AID FUNDS, INC.

 

United Student Aid Funds, Inc. (“USAF”) was organized as a private, nonprofit corporation under the General Corporation Law of the State of Delaware in 1960.  In accordance with its Certificate of Incorporation, USAF: (i) maintains facilities for the provision of guarantee services with respect to approved education loans made to or for the benefit of eligible students attending approved educational institutions; (ii) guaranteed education loans made pursuant to certain loan programs under the Higher Education Act, as well as loans made under certain private loan  programs; and (iii) serves as the designated guarantor for education-loan programs under the Higher Education Act of 1965, as amended (“the Act”) in Arizona, Hawaii and certain Pacific Islands, Indiana, Kansas, Maryland, Mississippi, Nevada and Wyoming.

USAF contracts with Navient Solutions, LLC and Student Assistance Corporation. Student Assistance Corporation is a wholly owned subsidiary of Navient Solutions, LLC.  Navient Solutions, LLC and its subsidiaries are not sponsored by nor are they agencies of the United States of America.

USAF is the sole member of the Northwest Education Loan Association, a guarantor serving the states of Washington, Idaho and the Northwest.  USAF, Inc. became a member of Great Lakes Higher Education Corporation, Affiliated Group, effective January 1, 2017.

For the purpose of providing loan guarantees under the Act, USAF has entered into various agreements (collectively, the “Federal Reinsurance Agreements”) with the U.S. Secretary of Education (the “Secretary”).  Pursuant to the Federal Reinsurance Agreements, USAF serves as a “guaranty agency” as defined in Section 435(j) of the Act.  The Act allows the Secretary, after giving the guaranty agency notice and the opportunity for a hearing, to terminate the Federal Reinsurance Agreements if the Secretary determines that the administrative or financial condition of the guaranty agency jeopardizes the agency’s continued ability to perform its responsibilities under its guaranty agreement, it is necessary to protect the federal financial interest, or to ensure the continued availability of loans to student- or parent-borrowers.

Reinsurance is paid to USAF by the Secretary in accordance with a formula based on the annual default rate of loans guaranteed by USAF under the Act and the disbursement date of loans.  The rate of reinsurance ranges from 100 percent to 75 percent of USAF’s losses on default-claim payments made to lenders.  The Consolidated Appropriations Act of 2016 provided for 100 percent reinsurance on all FFEL Program claims purchased beginning December 2015 and beyond.  Prior to that, the Higher Education Amendments of 1998 (the “1998 Reauthorization Law”) reduced the reinsurance coverage for loans in default made on or after Oct. 1, 1998, to a range from 95 percent to 75 percent based upon the annual default claims rate of the guaranty agency.  Reinsurance on non-default claims remains at 100 percent.

 

The 1998 Reauthorization Law requires guaranty agencies to establish two (2) separate funds, a federal reserve fund (property of the United States) and an agency operating fund (property of the guaranty agency).  The federal reserve fund is to be used to pay lender claims and to pay a default-aversion fee to the agency operating fund.  The agency operating fund is to be used by the guaranty agency to pay its operating expenses.

On March 30, 2010, President Obama signed into law the Health Care and Education Reconciliation Act of 2010 (Public Law 111-152), which ended the origination and guarantee of new loans under the Federal Family Education Loan Program, effective for loans whose first disbursement was after June 30, 2010.  As a result of the statute, USAF will continue to administer a portfolio of outstanding FFELP loans, but no longer may guarantee new federal student loans.

As of September 30, 2015, USAF held net assets on behalf of the federal reserve fund of approximately $130 million.  Through September 30, 2015, the outstanding, unpaid, aggregate amount of principal and interest on loans that had been directly guaranteed by USAF under the Federal Family Education Loan Program was approximately $51.8 billion.  Also, as of September 30, 2015, USAF had operating fund assets totaling almost $1.3 billion, which includes the $130 million of net assets held on behalf of the Federal Reserve Fund.

USAF’s “reserve ratio” complies with the Department of Education definition, which is determined by dividing the fund balance reserves in a guarantor’s federal reserve fund, by the total amount of loans outstanding.  Following this formula, the reserve ratio for the federal reserve fund administered by USAF for the last five fiscal years for which information was available was as follows:

 

Guarantor		Reserve Ratio
		Federal Fiscal Year
		2011				2012				2013				2014				2015
United Student Aid Funds, Inc.			0.394	%			0.354	%			0.313	%			0.277	%			0.251	%

USAF’s “recovery rate”, which provides a measure of the effectiveness of the collection efforts against defaulted borrowers after the guarantee claim has been satisfied, is determined by dividing the amount recovered from borrowers by USAF during the fiscal year by the aggregate amount of default claims paid by USAF outstanding at the end of the prior fiscal year.  For the last five fiscal years for which information was available, the “recovery rate” was as follows:

 

Guarantor		Recovery Rate
		Federal Fiscal Year
		2011				2012				2013				2014				2015
United Student Aid Funds, Inc.			32.17	%			31.82	%			30.55	%			32.01	%			34.93	%

 

USAF’s “loss rate” represents the percentage of claims purchased from lenders but not covered by reinsurance.  For the last five fiscal years for which information was available, the “loss rate” was as follows:

 

Guarantor		Loss Rate
		Federal Fiscal Year
		2011				2012				2013				2014				2015
United Student Aid Funds, Inc.			4.71	%			4.73	%			4.74	%			4.73	%			4.71	%

In addition, USAF’s “claims rate” represents the percentage of federal reinsurance claims paid by the Secretary during any fiscal year, less amounts remitted to the Secretary for defaulted loans that are rehabilitated relative to USAF’s existing portfolio of loans in repayment at the end of the prior fiscal year.  For the last five fiscal years for which information was available, the “claims rate” was as follows:

 

Guarantor		Claims Rate
		Federal Fiscal Year
		2011				2012				2013				2014				2015
United Student Aid Funds, Inc.			1.69	%			1.58	%			1.41	%			1.48	%			0.60	%

USAF is headquartered in Fishers, Indiana. USAF will provide a copy of its most recent annual report upon receipt of a written request directed to its headquarters at P.O. Box 6028, Indianapolis, Indiana 46206-6028, Attention: Vice President, Corporate and Marketing Communications.

 

 

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