Guaranteed Student Loan

(redirected from Guaranteed Student Loans)

Guaranteed Student Loan

A student loan on which repayment is guaranteed by a third party, especially the U.S. federal government. A student loan is financing used to pay for one's education, especially at the postsecondary or technical level. Because these loans do not purchase any asset to offer as collateral, they are high risk. However, a guaranteed student loan reduces the risk by promising that the third party will repay if the student defaults. Examples of federally guaranteed student loans in the United States include the Stafford loan and the PLUS loan.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
He regularly represents clients engaged in public and private offerings of debt and equity securities secured by auto loans and leases, marketplace and unsecured consumer loans, private and federally guaranteed student loans, mortgage loans, equipment, trade receivables, and other assets.
Most programs advise students with educational debt to consider deferment or forbearance (interest continues to accrue with the latter), available for most federally guaranteed student loans.
Government guaranteed student loans fall under special provisions in the BIA for student debt that mandate that student loans cannot be automatically discharged in a bankruptcy or consumer proposal unless you have ceased to be a student for at least seven years.
Early in the decade, Congress established the Student Loan Marketing Authority (Sallie Mae) to support a secondary market for government guaranteed student loans. (16) Sallie Mae was structured to borrow directly from the US Treasury and then buy guaranteed student loans from lenders so that they had more capital to make new loans.
The reason for this failure is that the disintermediation created by government guaranteed student loans frees schools from having to worry about whether students who secure their loans through the financial aid office will actually repay the debt.
Gaylon Layfield, III, President and Chief Executive Officer, commented: "Excluding our investments in two alternative asset classes, mortgage warehouse lending and guaranteed student loans, gross loans increased $44.1 million, or 7.0%, since the end of first quarter 2015.
Additionally, non-federally guaranteed student loans saw a 2.1% improvement to $3.5 billion, up 11.3% for the year.
These companies even remained profitable during the financial collapse and the recession, thanks in part to a perverse brand of Keynesian counter-cyclical stimulus: The economy might be on the ropes, but the federally guaranteed student loans kept coming, as students who faced poor employment prospects looked to higher education.
Banks, like Simmons First National Bank of Pine Bluff, that had aggressively marketed federally guaranteed student loans lost one revenue stream.
The administration is also mulling new requirements for private and federally guaranteed student loans, giving the more than 40 million Americans with student loans additional "basic rights and protections."
(The extra month allows a borrower to be late on a payment and still qualify.) The rules apply only to federally guaranteed student loans.
Mission Forsaken concludes with a call for the establishment of a "gainful education" standard to replace admission to an accredited institution as the qualification for the receipt of federally guaranteed student loans and grants.
Full browser ?