Sallie Mae 2009 Annual Report Download - page 184

8. Student Loan Securitization (Continued)
Key economic assumptions used in estimating the fair value of the Residual Interests at the date of
securitization resulting from the student loan securitization sale transactions completed during the years ended
December 31, 2009, 2008 and 2007 were as follows:
FFELP
Stafford
and
PLUS
(1)
FFELP
Consolidation
Loans
(1)
Private
Education
Loans
(1)
FFELP
Stafford
and PLUS
(1)
FFELP
Consolidation
Loans
(1)
Private
Education
Loans
(1)
FFELP
Stafford
and PLUS
(1)
FFELP
Consolidation
Loans
(1)
Private
Education
Loans
2009 2008 2007
Years Ended December 31,
Prepayment speed
(annual rate)
(2)
.. — — — — — — — — —
Interim status . . . . — — — — — — — — 0%
Repayment status . . — — — — — — — — 4-7%
Life of loan
repayment
status . . ...... — — — — — — — — 6%
Weighted average
life.......... — — — — — — — — 9.4yrs.
Expected credit
losses (% of
principal
securitized) . . . . — — — — — — — — 4.69%
Residual cash flows
discounted at
(weighted
average) ...... — — — — — — — — 12.5%
(1)
No securitizations qualified for sale treatment in the period.
(2)
The Company uses CPR curves for Residual Interest valuations that are based on seasoning (the number of months since entering
repayment). Under this methodology, a different CPR is applied to each year of a loan’s seasoning. The repayment status CPR used is
based on the number of months since first entering repayment (seasoning). Life of loan CPR is related to repayment status only and
does not include the impact of the loan while in interim status. The CPR assumption used for all periods includes the impact of pro-
jected defaults.
The following table summarizes cash flows received from or paid to the off-balance sheet securitization
trusts during the years ended December 31, 2009, 2008 and 2007:
(Dollars in millions) 2009 2008 2007
Years Ended December 31,
Net proceeds from new securitizations completed during the period..... $ — $ — $1,977
Cash distributions from trusts related to Residual Interests ........... 477 909 782
Servicing fees received
(1)
.................................... 225 246 286
Purchases of previously transferred financial assets for representation
and warranty violations ................................... (7) (37) (33)
Reimbursements of borrower benefits
(2)
......................... (36) (29) (22)
Purchases of delinquent Private Education Loans from securitization
trusts using delinquent loan call option ........................ — (172) (162)
Purchases of loans using clean-up call option ..................... — (697) (1,500)
(1)
The Company receives annual servicing fees of 90 basis points, 50 basis points and 70 basis points of the outstanding securitized loan
balance related to its FFELP Stafford, FFELP Consolidation Loan and Private Education Loan securitizations, respectively.
(2)
Under the terms of the securitizations, the transaction documents require that the Company reimburse the trusts for any borrower ben-
efits afforded the borrowers of the underlying securitized loans.
F-57
SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except per share amounts, unless otherwise stated)