Fitch Takes Negative Actions on 9 First Marblehead Student Loan ABS Deals

NEW YORK, Feb 06, 2009 (BUSINESS WIRE) -- STU | Quote | Chart | News | PowerRating -- Fitch Ratings has downgraded the ratings on 12 classes from the National Collegiate Student Loan Trust (NCSLT) 2006-1, 2006-2, and 2007-1 asset-backed securities (ABS) transactions issued by the First Marblehead Corporation (FMD), and places the ratings of three classes on Rating Watch Negative. Ten classes from these three trusts are either placed or remain on Rating Watch Negative. In addition, Fitch places the ratings of 25 classes from the NCSLT 2005-1, 2005-2, 2005-3, 2006-3, 2006-4 trusts on Rating Watch Negative, with 25 classes remaining on Rating Watch Negative where they were placed on Sept. 24, 2008. (See the full list of rating actions at the end of this release.)

The downgrades and Rating Watch Negative actions reflect default rates that continue to exceed Fitch's initial expectations and Fitch's ongoing concerns regarding the level of recoveries on defaulted loans in an environment post The Education Resources Institute (TERI). (TERI is the guarantor of the loans in the NCSLT transactions.) As a result of the higher than expected defaults, amounts held in the TERI funds pledged to certain older trusts to cover losses have been depleted sooner than expected. In addition, the TERI bankruptcy remains unresolved, clouding the recovery picture further. Although the TERI bankruptcy proceedings are ongoing, FMD has commenced collection activities on defaulted student loans financed by each trust.

Fitch's analysis focuses on further refining default levels and loss timing projections for each pool. In addition, Fitch will consider sensitivity analysis with regard to various recovery levels and timing patterns including an analysis of the availability of funds held in escrow and the impact of the suspension of 'rehab' loan sales which formerly resulted in near-term recoveries on re-performing loans.

Fitch will continue to monitor the transactions closely.

Read the rest of this article that include rating action on Trading Markets.

Student Loans Are Getting Denied Due To Bad Credit

by Tim Beachum

Ask any high school senior what their credit score is and they will reply with a Huh? After all this response should be too surprising. Most high school seniors are to busy for trivial things such as credit scores and student loans. Then the flags go up when they find out that do to their poor credit scores they cannot get a standard student loan. This is the point where most students begin to get discouraged.

If you should find yourself in this predicament the first thing that you should do is start hunting down a co-signer. In most cases you are met with rejection when you approach someone to be a co-signer. However when asking someone to co-sign for a student loan they are usually a little more acceptable. Make sure that you approach your prospect with your career plans in hand.

Do not take locating a cosigner lightly. This option is extremely advantageous to you. If you do happen to find a cosigner lender will take their credit history into consideration instead of yours. What this translates out to mean for you is lower interest rates. If a young student has a poor credit rating this may very well be their best option.

Ok its a swing and a miss You give it your best shot and you still cannot find a qualified co-signer. You next best option for a student loan is to contact banks as well as other lending institutions. Your goal by doing so is to find out if there are any alternative methods of financing your education. Many times these lending institutions will have a high interest rate solution. I bet you seen that one coming a mile away!

Once you finally find a loan that works for your situation dont start to think about it to deeply. Thinking about those high interest rates is not where your focus needs to be at this point in your life. Look at it this way - most college courses take 4-5 years for a student to complete. This is more than enough time for you to reestablish your credit at which time you can refinance your high interest rate loan for one with a much lower rate.

There is one more option I would like to make you aware of. That option is known as a combination loan or a combo loan. What it does is allows the student to consolidate all of their debts and apply for one big loan that will cover everything. By using the combination technique chances are you will end up with a fairly lower interest rate.

Hold on a second! Stop the presses! I almost forgot about two loans that are primarily geared towards those that may be having some financial hardships. Those loans are known as the Stafford Loan and The Perkins Loan.

It is important to keep in mind that even in a worse case scenario, obtaining a student loan or a scholarship is nothing more than a numbers game. If you were to go online and apply for every student loan and scholarship program that you can find you will be approved for a few of them. You will be blown away at the number of available loans and scholarships that you can apply for. The fact of the matter is you just may end up getting a free ride regardless of your financial situation. The key to your success is to avoid being discouraged and to keep plowing forward.

About the Author:Before you do anything regarding your bad credit student loan make sure you check out Tim Beachum’s website Bad Credit Student Loans website. You can get a unique content version of this article from the Uber Article Directory.

Students don't read the fine print on their loans

Recent study showed that over the past decade the amount of graduating seniors’ loan debt increased to 108 percent nationally. Approximately 54 percent of CSUN students have taken out federal loans, according to Gregorio Alcantar, a financial aid advisor. About 20 percent of all private loans are being used nationwide by four-year college undergraduates, graduate students and parent loans found the institute.

Although federal loans are available for students who fill out their FAFSA regardless of their income, government representatives are considering raising the amount students can borrow, according to Edie Irons, TICAS communications director. Irons believes the government should step in and rescue the students. Adding that financial aid is attractive to students who want to avoid taking out a federal loan, much less a private loan.

During the past five years tuition and fees at public universities have risen by 57% nationally. This semester, students did get the money they were promised by Cal Grant if they were eligible but the payments were delayed due to a lack of funding from the state.

While a recent report made by the California Faculty Association, shows that nearly 2.6 million Californian undergraduate students faced an average of $1,723 per student. Tution and fees at public universities have risen 57 percent nationally. Even though eligible students get money from Cal Grants, the payments were delayed due to a lack of state funding.

[Daily Sundial]

MBA Loan Crisis

Due to the loan crunch, international applicants to top business schools are panicking. They need to seek for U.S. co-signers to receive loans for their MBA education. Follow chat transcript on Business Week with Dan Thibeault, co-founder of Graduate Leverage, fields questions on the loan challenges facing international MBA applicants. He is anwering questions about what aspiring MBAs can do to turn their dreams into reality.

[Business Week]