Sallie Mae 2010 Annual Report Download - page 214

Loan Rebate Fee. A loan rebate fee of 1.05% is paid annually on the unpaid principal and interest of
each Consolidation Loan disbursed on or after October 1, 1993. This fee was reduced to .62% for loans made
from October 1, 1998 to January 31, 1999.
Stafford Loan Program
For Stafford Loans, the HEA provides for:
• federal reinsurance of Stafford Loans made by eligible lenders to qualified students;
• federal interest subsidy payments on Subsidized Stafford Loans paid by ED to holders of the loans in
lieu of the borrowers’ making interest payments during in-school, grace and deferment periods; and
• Special Allowance Payments representing an additional subsidy paid by ED to the holders of eligible
Stafford Loans.
We refer to all three types of assistance as “federal assistance.”
Interest. The borrower’s interest rate on a Stafford Loan can be fixed or variable. Variable rates are
reset annually each July 1 based on the bond equivalent rate of 91-day Treasury bills auctioned at the final
auction held before the preceding June 1. Stafford Loan interest rates are presented below.
Trigger Date Borrower Rate
Maximum
Borrower Rate Interest Rate Margin
Before 01/01/81 . .......... 7% 7% N/A
From 01/01/81 through
09/12/83............... 9% 9% N/A
From 09/13/83 through
06/30/88............... 8% 8% N/A
From 07/01/88 through
09/30/92............... 8%for48months; thereafter,
91-day Treasury + Interest Rate
Margin
8% for 48 months, then 10% 3.25% for loans made before
7/23/92 and for loans made on
or before 10/1/92 to new student
borrowers; 3.10% for loans made
after 7/23/92 and before 7/1/94
to borrowers with outstanding
FFELP Loans
From 10/01/92 through
06/30/94............... 91-day Treasury + Interest Rate
Margin
9% 3.10%
From 07/01/94 through
06/30/95............... 91-day Treasury + Interest Rate
Margin
8.25% 3.10%
From 07/01/95 through
06/30/98............... 91-day Treasury + Interest Rate
Margin
8.25% 2.50% (In-School, Grace or
Deferment); 3.10% (Repayment)
From 07/01/98 through
06/30/06............... 91-day Treasury + Interest Rate
Margin
8.25% 1.70% (In-School, Grace or
Deferment); 2.30% (Repayment)
From 07/01/06 through
06/30/08............... 6.8% 6.8% N/A
From 07/01/08 through
06/30/09............... 6.0% for undergraduate
subsidized loans; and 6.8% for
unsubsidized loans and graduate
subsidized loans.
6.0%, 6.8% N/A
From 07/01/09 through
06/30/10............... 5.6% for undergraduate
subsidized loans; and 6.8% for
unsubsidized loans and graduate
subsidized loans.
5.6%, 6.8% N/A
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