Class
|
Outstanding
Principal Amount
|
Interest Rate
|
Price
|
Next Reset Date
|
Legal Maturity Date
|
|||||
Class A-6B Notes
|
$127,369,569.17
|
SOFR Rate
plus %
|
100%
|
|
April 25, 2024
|
October 25, 2040
|
||||
Class A-6C Notes
|
$127,369,569.17
|
SOFR Rate
plus %
|
100%
|
|
April 25, 2024
|
October 25, 2040
|
Class A-6B Notes
|
Class A-6C Notes
|
|
Original principal amount
|
$200,000,000
|
$200,000,000
|
Current outstanding principal balance
|
$127,369,569.17
|
$127,369,569.17
|
Principal amount being remarketed
|
$127,369,569.17 (1)
|
$127,369,569.17 (1)
|
Remarketing Terms Determination Date
|
January 12, 2024
|
January 12, 2024
|
Notice Date(2)
|
January 22, 2024
|
January 22, 2024
|
Spread Determination Date(3)
|
On or before January 22, 2024
|
On or before January 22, 2024
|
Current Reset Date
|
January 25, 2024
|
January 25, 2024
|
All Hold Rate
|
SOFR Rate plus 0.75%
|
SOFR Rate plus 0.75%
|
Next applicable reset date
|
April 25, 2024
|
April 25, 2024
|
Interest rate mode
|
Floating
|
Floating
|
Index
|
SOFR Rate(4)
|
SOFR Rate(4)
|
Spread(5)
|
Plus %
|
Plus %
|
Day-count basis
|
Actual/360
|
Actual/360
|
Weighted average remaining life
|
(6)
|
(6)
|
(1) |
Subject to the receipt of timely delivered Hold Notices.
|
(2) |
Unless an existing class A-6B or class A-6C noteholder submits a Hold Notice to the remarketing agent prior to 12:00 p.m. (noon), New York City time, on the Notice Date, such notes will be irrevocably deemed to have been tendered for
remarketing.
|
(3) |
The applicable Spread may be determined at any time after 12:00 p.m. (noon), New York City time, on the Notice Date but not later than 3:00 p.m., New York City time, on January 22, 2024.
|
(4) |
The “SOFR Rate” will be a per annum rate equal to 90-day Average SOFR for such reset period plus a tenor spread adjustment equal to 0.26161% per annum. The SOFR Rate will be reset on each reset date in accordance with the procedures set
forth under “Description of the Notes—Determination of Indices—SOFR” in the free-writing prospectus.
|
(5) |
To be determined on the spread determination date.
|
(6) |
The projected weighted average remaining life to the April 25, 2024 reset date of the class A-6B and class A-6C notes (and assuming a successful remarketing of such notes on the current reset date) under various usual and customary
prepayment scenarios is approximately 0.25 years. More information may be found under “Prepayments, Extensions, Weighted Average Remaining Life and Expected Maturity of the Class A-6B and Class A-6C Notes”
to be included as Exhibit I to the final remarketing prospectus supplement to be distributed to potential investors on or prior to the spread determination date.
|
REMARKETING TERMS SUMMARY
|
i
|
INTRODUCTION
|
ii
|
FORWARD-LOOKING STATEMENTS
|
ix
|
SUMMARY OF NOTE TERMS
|
1
|
RISK FACTORS
|
21
|
DEFINED TERMS
|
45 |
THE TRUST
|
45 |
USE OF PROCEEDS
|
49
|
AFFILIATIONS AND RELATIONS
|
49
|
THE DEPOSITOR
|
50
|
NAVIENT CORPORATION
|
51
|
THE SPONSOR, SERVICER AND ADMINISTRATOR
|
53
|
THE SELLERS
|
55
|
THE TRUST STUDENT LOAN POOL
|
56
|
THE COMPANIES’ STUDENT LOAN FINANCING BUSINESS
|
60
|
TRANSFER AGREEMENTS
|
65
|
SERVICING AND ADMINISTRATION
|
68
|
TRADING INFORMATION
|
78
|
DESCRIPTION OF THE NOTES
|
80 |
INDENTURE
|
119
|
CERTAIN LEGAL ASPECTS OF THE STUDENT LOANS
|
125
|
STATIC POOLS
|
130
|
PREPAYMENTS, EXTENSIONS, WEIGHTED AVERAGE REMAINING LIFE AND EXPECTED MATURITY OF THE CLASS A-6B AND CLASS A-6C NOTES
|
130
|
RECENT DEVELOPMENTS
|
132 |
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS
|
132
|
STATE AND LOCAL TAX CONSEQUENCES
|
141
|
ERISA CONSIDERATIONS
|
141
|
ACCOUNTING CONSIDERATIONS
|
144
|
REPORTS TO NOTEHOLDERS
|
144
|
REMARKETING
|
145
|
NOTICES TO INVESTORS
|
146
|
LISTING INFORMATION
|
147
|
DEPOSITOR AFFIRMATIONS
|
148
|
CERTAIN INVESTMENT COMPANY ACT CONSIDERATIONS
|
148
|
RATINGS
|
149
|
LEGAL PROCEEDINGS
|
149
|
LEGAL MATTERS
|
153
|
GLOSSARY
|
154
|
ANNEX A:
|
The Trust Student Loan Pool as of November 30, 2023
|
APPENDIX A:
|
Federal Family Education Loan Program
|
APPENDIX B:
|
Global Clearance, Settlement and Tax Documentation Procedures
|
EXHIBIT I:
|
Prepayments, Extensions, Weighted Average Remaining Life and
|
|
Expected Maturity of the Class A-6B and Class A-6C Notes
|
|
Class
|
Spread
|
|
Class A-6B
|
plus %
|
|
Class A-6C
|
plus %
|
|
Class
|
Spread
|
|
Class A-6B
|
plus %
|
|
Class A-6C
|
plus %
|
•
|
the remarketing agent, in consultation with the administrator, cannot determine the applicable required reset terms on or before the remarketing terms determination date;
|
•
|
the remarketing agent cannot establish the required spread on the spread determination date;
|
•
|
the remarketing agent is unable to remarket some or all of the tendered reset rate notes at the spread set by the remarketing agent, or one or more committed purchasers default on their purchase
obligations and the remarketing agent chooses not to purchase such reset rate notes itself;
|
|
•
|
any rating agency then rating the notes has not confirmed or upgraded its then-current rating of any class of notes, if such confirmation is required; or
|
•
|
certain other conditions specified in the remarketing agreement are not satisfied.
|
•
|
all holders of the applicable class will retain their reset rate notes, including in all deemed mandatory tender situations;
|
•
|
the related interest rate for the applicable class of reset rate notes will be reset to a failed remarketing rate of the SOFR Rate plus 0.75% per annum; and
|
•
|
the related reset period will be set at three months.
|
|
•
|
Class A-1 Student Loan-Backed Notes in the original principal amount of $317,000,000, none of which remain outstanding;
|
•
|
Class A-2 Student Loan-Backed Notes in the original principal amount of $482,000,000, none of which remain outstanding;
|
•
|
Class A-3 Student Loan-Backed Notes in the original principal amount of $326,000,000, none of which remain outstanding;
|
•
|
Class A-4 Student Loan-Backed Notes in the original principal amount of $507,000,000, none of which remain outstanding;
|
•
|
Class A-5 Student Loan-Backed Notes in the original principal amount of $591,000,000, none of which remain outstanding; and
|
•
|
Class A-6A Student Loan-Backed Notes in the original principal amount of $382,968,000, and currently outstanding in the amount of $243,878,335.17.
|
|
•
|
Class B Student Loan-Backed Notes in the original principal amount of $92,968,000, and currently outstanding in the amount of $32,748,991.96.
|
•
|
the floating rate class A notes and the reset rate notes collectively as the class A notes;
|
•
|
the floating rate class A notes and the class B notes as the floating rate notes; and
|
•
|
the floating rate notes and the reset rate notes as the notes.
|
Class
|
Spread
|
|
Class A‑6A
|
plus 0.16%
|
|
Class B
|
plus 0.21%
|
•
|
first, the class A noteholders’ principal distribution amount in the following order of
priority:
|
•
|
pro rata, to the class A-6A, class A-6B and class A-6C notes until their respective principal balances are reduced to zero; provided, that either (a) if the class A-6B and/or class A-6C notes are then
denominated in a currency other than U.S. Dollars and are structured to receive payments of principal on each applicable distribution date, any payments due to the related reset rate noteholders will be made to the related currency
swap counterparty or (b) if the class A-6B and/or class A-6C notes are then structured not to receive a payment of principal until the end of the related reset period, any payments due to the related reset rate noteholders will be
allocated to the related accumulation account; and
|
•
|
second, on each distribution date on and after the stepdown date, and provided that no trigger
event is in effect on such distribution date, the class B noteholders’ principal distribution amount, to the class B notes, until their principal balance is reduced to zero
|
|
|
Class
|
Maturity Date
|
|
Class A-6A
|
October 25, 2040
|
|
Class A-6B
|
October 25, 2040
|
|
Class A-6C
|
October 25, 2040
|
|
Class B
|
October 25, 2040
|
•
|
there are prepayments on the trust student loans;
|
•
|
the servicer exercises its option to purchase all remaining trust student loans, which will not occur until the first distribution date on which the pool balance is 10% or less of the initial pool
balance; or
|
•
|
the indenture trustee auctions all remaining trust student loans, which absent an event of default under the indenture, will not occur until the first distribution date on which the pool balance is
10% or less of the initial pool balance.
|
|
|
•
|
the trust student loans;
|
•
|
collections and other payments on the trust student loans;
|
•
|
funds it currently holds or will hold from time to time in its trust accounts, including a collection account; a reserve account; one or more accumulation accounts; one or more supplemental interest
accounts; an investment reserve account; an investment premium purchase account; a remarketing fee account; and if the class A-6B or class A-6C notes are denominated in a currency other than U.S. Dollars, a currency account;
|
•
|
its rights under the transfer and servicing agreements, including the right to require VG Funding (or Navient Solutions, LLC, as servicer, acting on its behalf), Navient CFC, the depositor or the
servicer to repurchase trust student loans from it or to substitute loans under certain conditions;
|
•
|
its rights under any swap agreement or potential future interest rate cap agreement, as applicable; and
|
•
|
its rights under the guarantee agreements with guarantors.
|
|
|
•
|
on the related maturity date for each class of class A notes and upon termination of the trust, to cover shortfalls in payments of the class A noteholders’ principal and accrued interest to the
related class of notes; and
|
•
|
on the class B maturity date and upon termination of the trust, to cover shortfalls in payments of the class B noteholders’ principal and accrued interest, any carryover servicing fees, any remaining
swap termination payments and remarketing fees and expenses.
|
|
•
|
if the applicable class of reset rate notes is then denominated in U.S. Dollars, on the next reset date, to the related reset rate noteholders, after all other required distributions have been made on
that reset date; or
|
•
|
if the applicable class of reset rate notes is then denominated in a currency other than U.S. Dollars, on or about the next related reset date, to the currency swap counterparty or counterparties,
which will in turn pay the applicable currency equivalent of those amounts to the trust, for payment to the reset rate noteholders on the second business day following the related reset date, after all other required distributions
have been made on that reset date.
|
|
|
|
•
|
the amount of specified increases in the costs incurred by the servicer;
|
•
|
the amount of specified conversion, transfer and removal fees;
|
•
|
any amounts described in the first two bullets that remain unpaid from prior distribution dates; and
|
•
|
interest on any unpaid amounts.
|
|
•
|
the maturity or other liquidation of the last trust student loan and the disposition of any amount received upon its liquidation; and
|
•
|
the payment of all amounts required to be paid to the noteholders.
|
•
|
pay to noteholders the interest payable on the related distribution date; and
|
•
|
reduce the outstanding principal amount of each class of notes then outstanding on the related distribution date to zero, taking into account all amounts then on deposit in the accumulation account.
|
•
|
is then structured not to receive a payment of principal until the end of the related reset period, the outstanding principal balance of the such class of reset rate notes will be deemed to have been
reduced by any amounts on deposit, exclusive of any investment earnings, in the accumulation account; and/or
|
•
|
is then denominated in a non-U.S. Dollar currency, the U.S. Dollar equivalent of the then-outstanding principal balance of such class of reset rate notes will be determined based upon the exchange
rate provided for in the currency swap agreement or agreements.
|
•
|
Special tax counsel to the trust is of the opinion that the class A-6B and class A-6C notes will be characterized as debt for U.S. federal income tax purposes.
|
•
|
Special tax counsel to the trust is of the opinion that the trust will not be characterized as an association taxable as a corporation or a publicly traded partnership taxable as a corporation for U.S.
federal income tax purposes.
|
•
|
Delaware tax counsel for the trust is of the opinion that the same characterizations will apply for Delaware state income tax purposes as for U.S. federal income tax purposes and noteholders who were
not otherwise subject to Delaware taxation on income would not become subject to Delaware tax as a result of their ownership of notes.
|
|
•
|
an exemption from the prohibited transaction provisions of Section 406 of the Employee Retirement Income Security Act of 1974, as amended, and Section 4975 of the Internal Revenue Code of 1986, as
amended, applies, so that the purchase or holding of the class A-6B or class A-6C notes will not result in a non-exempt prohibited transaction; and
|
•
|
the purchase or holding of the class A-6B or class A-6C notes will not cause a non-exempt violation of any substantially similar federal, state, local or foreign laws.
|
•
|
class A-6A notes: “AAAsf” by Fitch, “Aaa (sf)” by Moody’s and “AA+ (sf)” by S&P.
|
•
|
class A-6B notes: “AAAsf” by Fitch, “Aaa (sf)” by Moody’s and “AA+ (sf)” by S&P.
|
•
|
class A-6C notes: “AAAsf” by Fitch, “Aaa (sf)” by Moody’s and “AA+ (sf)” by S&P.
|
•
|
class B notes: “Asf” by Fitch, “A3 (sf)” by Moody’s and “AA (sf)” by S&P.
|
CUSIP Number
|
83149E AJ 6
|
International Securities Identification Number (ISIN)
|
US83149EAJ64
|
European Common Code
|
025895991
|
CUSIP Number
|
83149E AK 3
|
International Securities Identification Number (ISIN)
|
US83149EAK38
|
European Common Code
|
025896092
|
|
General Risks
|
||
Federal Financial Regulatory
Legislation or Economic
Relief Legislation Could Have An Adverse Effect On Navient Corporation, Navient
Solutions LLC, The Servicer,
The Administrator, The
Depositor, The Sellers And
The Trust, Which Could
Result In Losses Or Delays In
Payments On Your Notes
|
On July 21, 2010, President Obama signed into law the Dodd‑Frank Wall Street Reform and Consumer Protection Act (the “Dodd‑Frank Act”) to reform and strengthen supervision of the U.S. financial services
industry. The Dodd‑Frank Act represents a comprehensive change to existing laws, imposing significant new regulation on almost every aspect of the U.S. financial services industry.
The Dodd‑Frank Act has resulted in significant new regulation in key areas of the business of Navient Corporation (formerly known as SLM Corporation), the direct parent of Navient Solutions, LLC
and the indirect parent of Navient Funding, LLC, and its affiliates and the markets in which Navient Corporation, the sponsor and their affiliates operate. Pursuant to the Dodd‑Frank Act, Navient Corporation and many of its subsidiaries
are subject to regulations promulgated by the Consumer Financial Protection Bureau (the “CFPB”). The CFPB has substantial power to define the rights of consumers and the responsibilities of certain institutions, including Navient
Corporation, the sponsor and their affiliates, in connection with their education loan origination and servicing businesses. In addition, the CFPB has the authority to bring enforcement actions against student lenders and student loan
servicers for violations of federal consumer protection regulations and with respect to acts or practices that the CFPB determines to be unfair, deceptive or abusive. In a recent action brought by the CFPB, CFPB v. Nat’l Collegiate Master Student Loan Trust, the U.S. District Court for the District of Delaware denied a motion to dismiss filed by a securitization trust by holding that the trust is a “covered person” under the
Dodd-Frank Act because it engages in the servicing of loans, even if through servicers and subservicers. While the court did not decide whether the trust could be held liable for the conduct of the servicer at this stage of the case, the
CFPB may now make that argument and the case remains pending. The CFPB may rely on this decision as precedent in investigating and bringing enforcement actions against other securitization issuers, such as the trust, in the future.
|
It is likely that operational expenses of Navient Corporation, the sponsor or their affiliates will increase if new or additional compliance requirements under the Dodd‑Frank Act are imposed on their
operations and their competitiveness could be significantly affected if they are subjected to supervision and regulatory standards not otherwise applicable to their competitors.
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. The CARES Act provides relief to borrowers under federal direct student loans and
FFELP loans owned by the United States Department of Education, in the form of a 0% interest rate and a suspension of payments, until September 30, 2020, and this period was subsequently extended and payments resumed in October 2023. On
March 30, 2021, the United States Department of Education announced an expansion of this relief on federal student loan interest and collections to all defaulted FFELP loans retroactive to March 13, 2020, the start of the COVID-19 national
emergency. On August 24, 2022, President Biden introduced new income-driven repayment options for borrowers of federal student loans and introduced revised rules for the Public Service Loan Forgiveness (PSLF) program that are not in
default. These borrower relief programs, including the CARES Act, only apply to FFELP loans and federal direct student loans, but there is no assurance that future financial regulatory legislation, economic relief legislation or executive
orders will not directly or indirectly affect the trust student loans, or otherwise affect the servicer’s business.
|
||
The Bankruptcy Of The
Depositor, Navient CFC Or
Any Other Seller Could Delay
Or Reduce Payments On Your
Notes
|
We have taken steps to assure that the voluntary or involuntary application for relief by the depositor, Navient CFC, which is the sole member of the depositor, or any other applicable seller under the United
States Bankruptcy Code or other insolvency laws will not result in consolidation of the assets and liabilities of the trust with those of the depositor, Navient CFC and the other sellers. However, we cannot guarantee that the activities of
the depositor, the sellers, the sponsor or the trust will not result in a court concluding that the trust’s assets and liabilities should be consolidated with those of the depositor, Navient CFC or any other seller in a proceeding under any
insolvency law. If a court were to reach this conclusion or a filing were made under any insolvency law by or against us, or if an attempt were made to litigate this issue, then delays in distributions on the notes or reductions in these
amounts could result.
Navient CFC, the other sellers of the student loans and the depositor intend that each transfer of student loans to the trust will constitute a true sale. If such transfer constitutes a true
sale, the student loans and their proceeds would no longer be considered property of the depositor, Navient CFC or the other sellers should any such seller become subject to an insolvency law.
|
If the depositor, Navient CFC or any other seller were to become subject to an insolvency law, and a creditor, a trustee-in-bankruptcy or the seller itself were to take the position that the sale
of student loans from the related seller to the depositor should instead be treated as a pledge of the student loans to secure a borrowing of that seller, delays in payments on the notes could occur.
In addition, if the court ruled in favor of this position, reductions in the amount of payments on the notes could result.
|
||
The Bankruptcy Of The
Servicer Could Delay
The
Appointment Of A Successor
Servicer Or Reduce Payments
on your notes
|
In the event of a default by the servicer resulting solely from certain events of insolvency or the bankruptcy of the servicer, a court, conservator, receiver or liquidator (including the FDIC) may have the
power to prevent any of the servicer, the trust, the indenture trustee or the noteholders, as applicable, from appointing a successor servicer and delays in the collection of payments on the trust student loans may occur. It may also be
difficult to find a third party to act as successor servicer, and the trust may have to increase the servicing fee in order to obtain such successor servicer. Any resulting delay in the collection of payments on the affected trust student
loans may delay or reduce payments to noteholders. In addition, in the event of an insolvency or a bankruptcy of the servicer, a court, conservator, receiver or liquidator may permit the servicer to assign its rights and obligations as
servicer to a third party without complying with the provisions of the transaction documents.
|
|
Risks Related To The Notes
|
||
Because The Notes May Not
Provide Regular Or
Predictable Payments, You
May Not Receive The Return
On Your Investment That You Expected
|
The notes may not provide a regular or predictable schedule of payments or payment on any specific date. Accordingly, you may not receive the return on your investment that you expected.
|
The Notes Are Not Suitable
Investments For All
Investors
|
The reset rate notes are complex investments that should be considered only by investors who, either alone or with their financial, tax and legal advisors, have the expertise to analyze the prepayment,
reinvestment, default and market risk, and tax consequences of such an investment, as well as the interaction of these factors. You should not purchase the reset rate notes unless you understand the structural, prepayment, credit,
liquidity and market risks associated with the reset rate notes, the regulatory and enforcement risks relating to the trust student loans, the tax consequences of an investment in the reset rate notes and the interaction of the foregoing
factors. The interaction of the factors described in this free-writing prospectus and other factors that may affect the reset rate notes and their combined effects on the reset rate notes are not possible to predict with meaningful
certainty and are likely to change from time to time. As a result, an investment in the reset rate notes involves substantial risks and uncertainties and should be considered only by sophisticated institutional investors with substantial
investment experience with similar types of securities and who have conducted an appropriate analysis of the reset rate notes. Prospective investors must be able to bear the risk of loss (including total loss) on their investment in the
reset rate notes.
|
|
Sequential Payment Of The
Notes Results In A Greater
Risk Of Loss
|
If a failed remarketing occurs, the reset rate notes would become subject to the failed remarketing rate, which is higher than the interest rate that would otherwise be applicable to such class of notes.
This would reduce the amount of available funds to pay interest on other classes of notes and principal on the reset rate notes. In that case, or if prepayments are much higher than anticipated, or if losses on the trust student loans are
greater than expected, you may suffer a loss.
|
|
Illiquid Market Conditions
May Occur From Time To
Time
|
From time to time, the secondary market for your class A-6B or class A-6C notes may be adversely affected by a deterioration of general economic conditions, periods of general market illiquidity or by events
in the global financial markets in general or in the securitization market in particular. See “Risk Factors – Current General Economic Conditions, Or A Further Deterioration of Economic Conditions, May
Increase the Risk of Loss on Your Investment” in this free-writing prospectus. For example, the recent failures of Silicon Valley Bank, Signature Bank and First Republic Bank and the intervention of the Swiss National Bank
resulting in the acquisition of Credit Suisse AG by UBS Group AG have resulted in significant concern regarding the health of other banking institutions and the ability of such institutions to withstand the economic conditions posed by
rapidly increasing interest rates including a decline in value of securities and loan portfolios. It is unclear what impact such bank failures will have, for how long any associated impact may last and whether there will be additional bank
failures, and as a result the liquidity and market value of the Notes may be adversely affected. In addition, recent regulatory interpretations by the Securities and Exchange Commission under Exchange Act Rule 15c2-11 may further restrict
the ability of brokers and dealers to publish quotations on the class A-6C notes on any interdealer quotation system or other quotation medium after January 4, 2025.
|
Additionally, on August 1, 2023, Fitch Ratings, Inc. downgraded the U.S. government's credit rating from AAA to AA+, citing rising debt at the federal, state, and local levels and a steady
deterioration in standards of governance (including debt ceiling negotiations that threatened the government’s ability to pay its bills). It is unclear what impact such downgrade will have, for how long any associated impact may last and
whether there will be additional downgrades, and as a result the liquidity and market value of the notes may be adversely affected.
Accordingly, you may not be able to sell your class A-6B or class A-6C notes when you want to do so or you may be unable to obtain the price that you wish to receive for your class A-6B or class
A-6C notes and, as a result, you may suffer a loss on your investment.
|
||
School Closures And
Unlicensed Schools May
Result In Losses On Your
Notes
|
Some of the trust student loans are subject to the so-called “Holder-in-Due-Course” rule of the Federal Trade Commission (the “Holder Rule”) the provisions of which are similar to those contained in the
Uniform Consumer Credit Code and in state statutes and common law of many states. The effect of these laws is to subject a seller (and certain lenders and their assignees, such as the trust) in a consumer credit transaction to all claims
and defenses which the obligor in the transaction can assert against the seller of the goods or services. Under these laws, the trust as holder of the trust student loans may be subject to any claims or defenses that the student borrower
may assert against its school for failure of the school to satisfy its obligations under the enrollment agreement with the student as a result of a school closure, a school bankruptcy or otherwise. If a student is successful in asserting
such a claim, the student may have the right to recover from the trust payments previously made on the related trust student loan and have a defense against making further payments. In this event, to the extent available funds and credit
enhancement are insufficient to cover such amounts, you may suffer a loss on your investment.
In addition, generally state law requires schools engaged in providing educational services in their state to be licensed by a state regulatory authority. In most states, if a school is not licensed at the
time the student signs the enrollment agreement, the enrollment agreement may be void and, as a result, the student will have a defense against repayment of the loan. To the extent that a related school became unlicensed prior to the
student signing the enrollment agreement, the related borrower may have the right to recover payments previously made on the related trust student loan and may have a defense against further payment. There is also a possibility that a
school has failed to maintain its license under applicable law since the origination of the related trust student loans, and in such event, the related borrower may be entitled to the claims or defenses with respect to payments on its trust
student loan described above. In either of these instances, to the extent available funds and credit enhancement is insufficient to cover such amounts, you may suffer a loss on your investment.
|
The Issuing Entity Will Have
Limited Assets From Which
To Make Payments On The
Notes, Which May Result In
Losses
|
The issuing entity will not have, nor will it be permitted to have, significant assets or sources of funds other than the pool of trust student loans and the related guarantee agreements. The issuing entity
will also have a reserve account established in the issuing entity’s name.
Consequently, you must rely upon payments on the trust student loans from the borrowers and guarantors, as applicable, and, if available, amounts on deposit in the trust accounts described above,
and overcollateralization to repay your notes. If these sources of funds are unavailable or insufficient to make payments on your notes, you may experience a loss on your investment.
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Your Notes Will Have A
Degree Of Basis Risk, Which
Could Compromise The
Trust’s Ability To Pay
Principal And Interest On
Your Notes
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There is a degree of basis risk associated with the class A-6B and class A-6C notes. Basis risk is the risk that shortfalls might occur because, among other things, while the effective interest rates of the
trust student loans adjust on the basis of specified indices and those of the notes adjust on the basis of a different SOFR index, different indices or, with respect to the reset rate notes at a time when such notes are in fixed rate mode,
do not adjust at all. If a shortfall were to occur, the trust’s ability to pay principal of and/or interest on your notes could be compromised. See “Annex A—The Trust Student Loan Pool—Composition of the Trust Student Loans as of the
Statistical Disclosure Date” in this free-writing prospectus which specifies the percentages of trust student loans that adjust based on a 30-day SOFR index or the 91-day Treasury bill rate, as applicable.
If the interest rates on the trust student loans decline or the interest rate on a class of notes increases, this could decrease the amount of collections available to make interest and principal
payments on the notes. This would increase the risk that there may not be sufficient collections to make all required payments on the notes.
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A Change To The Interest
Benchmark For The Special
Allowance Payments On The
Trust Student Loans May
Have An Adverse Effect On
Your Notes
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In the event that SOFR is no longer available to calculate special allowance payments based on 30-day Average SOFR, on or after July 1, 2023, as applicable for certain FFELP loans, it is possible that the
Department of Education may choose a replacement rate for 30-day Average SOFR for the purpose of determining special allowance payments and, if such replacement rate is different than any potential replacement rate selected by the
administrator with respect to the trust and the trust does not subsequently enter into an amendment to adopt the same replacement rate as selected by the Department of Education, such replacement rate may worsen the basis risk associated
with the floating rate notes. See “—Your Notes Will Have A Degree Of Basis Risk, Which Could Compromise The Trust’s Ability To Pay Principal And Interest On Your Notes,” above.
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You May Be Unable To
Reinvest Principal Payments
At The Yield You Earn On
The Notes
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Asset-backed notes usually produce increased principal payments to investors when market interest rates fall below the interest rates on the collateral—student loans in this case—and decreased principal
payments when market interest rates rise above the interest rates on the collateral. As a result, you are likely to receive more money to reinvest at a time when other investments generally are producing lower yields than the yield on the
notes. Similarly, you are likely to receive less money to reinvest when other investments generally are producing higher yields than the yield on the notes.
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Withdrawal Or Downgrade
Of Ratings May Decrease
The Prices Of Your Notes
|
A security rating is not a recommendation to buy, sell or hold securities. Similar ratings on different types of securities do not necessarily mean the same thing. A rating agency may revise or withdraw its
rating at any time if it believes circumstances have changed. A subsequent downgrade in the rating on your notes is likely to decrease the price a subsequent purchaser will be willing to pay for your notes.
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A Conflict Of Interest May
Exist Between The Rating
Agencies Engaged To Rate
The Notes And The
Transaction Parties
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The SEC has taken the position that being paid by the sponsor, issuer or an underwriter to issue and/or maintain a credit rating on asset backed securities may create a conflict of interest for rating
agencies, and that this potential conflict is particularly acute because arrangers of asset-backed securities transactions provide repeat business to such rating agencies. Potential investors in the class A-6B or class A-6C notes should
make their own determinations regarding whether such a conflict of interest actually exists, whether any such potential conflict of interest impacts a rating from any retained rating agency and the weight given to any particular rating in
making an investment decision in the class A-6B or class A-6C notes.
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A Further Lowering Of The
Credit Rating of the United
States Of America May
Adversely Affect The Market
Value Of Your Notes
|
The credit rating of the United States may potentially be downgraded by one or more nationally recognized statistical rating organizations (an “NRSRO”) within the meaning of Section 3(a)(62) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). The impact of any such potential downgrades is unknown, and depending on any lowered rating assigned, the stated reasons for a lower rating and other factors, the liquidity, market
value and regulatory characteristics of your notes could be materially and adversely affected.
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Certain Actions Can Be
Taken Without Noteholder
Approval
|
The transaction documents provide that certain actions may be taken based upon receipt by the indenture trustee of a confirmation from each of the rating agencies that the then current ratings assigned by the
rating agencies then rating the notes will not be downgraded or withdrawn by those actions. In this event, such actions may be taken without the consent of noteholders.
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Uncertainty About A Change
To The Benchmark For The
Floating Rate Notes May
Have An Adverse Effect On
Your Floating Rate Notes.
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The interest rates on the class A-6B and class A-6C notes is based on a benchmark plus a spread. For all reset periods prior to the July 2023 reset period, the class A-6B and class A-6C notes bore interest by
reference to a LIBOR-based index plus a spread. In response to the prospective cessation of US-dollar LIBOR and to address the difficulties of dealing with legacy LIBOR contracts, Congress enacted the Adjustable Interest Rate (LIBOR) Act
(the “LIBOR Act”), as part of the Consolidated Appropriations Act, 2022. The LIBOR Act provides that for any asset backed-securities backed by FFELP loans that have an adjustable rate based on three-month LIBOR and for which no replacement
index is specified in the governing documents, such as the class A-6B and class A-6C notes, the replacement benchmark was established as 90-day Average SOFR plus a specified tenor spread adjustment on the first London business day after
June 30, 2023. As a result, commencing with the reset period that began on July 25, 2023 and each subsequent reset period prior to a successful remarketing, the class A-6B and class A-6C notes will bear interest by reference to SOFR Rate.
The “SOFR Rate” will be a per annum rate equal to 90-day Average SOFR for such reset period plus the tenor spread adjustment equal to 0.26161% per annum, as specified in the LIBOR Act. The SOFR Rate will be reset on each reset date in
accordance with the procedures set forth under “Description of the Notes—Determination of Indices—SOFR” in this free-writing prospectus. The LIBOR Act also provides for the adoption of benchmark
replacements if SOFR is no longer available.
The benchmark will change in the event of a benchmark replacement following the occurrence of a benchmark transition event and its related benchmark replacement date (as further described in this
free-writing prospectus under “Description of the Notes—Determination of Indices”).
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The Federal Reserve Bank of New York, or the “FRBNY”, publishes the Secured Overnight Funding Rate (“SOFR”) based on data received by it from sources other than the sponsor, and neither the sponsor nor any
other party to the transaction described in this free-writing prospectus has any control over its calculation methods, publication schedule, rate revision practices or availability of SOFR at any time. There can be no guarantee,
particularly given its relatively recent introduction, that SOFR will not be discontinued or fundamentally altered in a manner that is materially adverse to the interests of investors in the class A-6B or class A-6C notes. If the manner in
which SOFR is calculated is changed, that change may result in a reduction in the amount of interest payable on the class A-6B or class A-6C notes and the trading prices of the class A-6B or class A-6C notes.
Further, as described under “Description of the Notes—Determination of Indices” in this free-writing prospectus, in the event a benchmark transition event
and its related benchmark replacement date have occurred, the benchmark replacement will depend on the availability of various benchmark rates set forth in this free-writing prospectus. These benchmark rates may be calculated using
components different from those used in the calculation of the SOFR Rate and may fluctuate differently than, and not be representative of, the SOFR Rate. In order to compensate for these differences in the benchmark replacements, a
benchmark replacement adjustment may be included in any benchmark replacement. However, we cannot provide any assurances that any benchmark replacement adjustment will be sufficient to produce the economic equivalent of the then-current
benchmark, either at the benchmark replacement date or over the life of the floating rate notes. As a result of each of the foregoing factors, we cannot provide any assurances that the characteristics of any benchmark will be similar to the
then-current benchmark that it is replacing, or that any benchmark replacement will produce the economic equivalent of the then-current benchmark that it is replacing.
Additionally, the determination of any benchmark replacement, the calculation of the interest rate on the class A-6B or class A-6C notes by reference to a benchmark replacement (including the application of
any benchmark replacement adjustment), any implementation of benchmark replacement conforming changes and any other determinations, decisions or elections that may be made under the terms of the class A-6B or class A-6C notes in connection
with a benchmark transition event, could adversely affect the value of the class A-6B or class A-6C notes, the return on the class A-6B or class A-6C notes and the price at which class A-6B or class A-6C noteholders can sell such class A-6B
or class A-6C notes, as applicable. Furthermore, the issuing entity cannot anticipate how long it will take to adopt a specific benchmark replacement, which may delay and contribute to uncertainty and volatility surrounding any benchmark
transition event or benchmark replacement.
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The administrator will have discretion in certain elements of any benchmark replacement process, including determining if a benchmark transition event and its related benchmark replacement date have occurred,
determining which benchmark replacement is available and, if applicable, selecting an unadjusted benchmark replacement, determining the benchmark replacement adjustment and making benchmark replacement conforming changes. The noteholders
will not have any right to approve or disapprove of these changes and will be deemed to have agreed to waive and release any and all claims relating to any such determinations. See “Description of the
Notes—Determination of Indices” in this free-writing prospectus.
Any of the above matters or any other significant change to the setting or existence of the SOFR Rate or any successor benchmark for the floating rate notes could affect the amounts available to the issuing
entity to meet its obligations under the floating rate notes and/or could have a material adverse effect on the value or liquidity of, and the amount payable under, the floating rate notes.
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SOFR Is A Relatively New
Reference Rate That May Be
More Volatile Than Other
Benchmark Or Market Rates
And Its Composition And
Characteristics Are Not The
Same As LIBOR
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For reset periods that commenced before July 2023, class A-6B and class A-6C notes accrued interest at a floating rate based on three-month LIBOR plus a spread. Commencing with the reset period that began on
July 25, 2023 and each subsequent reset period prior to a successful remarketing, class A-6B and class A-6C notes accrued or will accrue interest at a floating rate based on a spread over a benchmark rate, which will be the SOFR Rate. The
SOFR Rate is based on compounded averages of SOFR, which are used to determine Compounded SOFR. For information on how the SOFR Rate and Compounded SOFR are determined, you should read “Description of the
Notes—Determination of Indices” in this free-writing prospectus. The secured overnight financing rate published for any day by the FRBNY on the FRBNY’s website, or by a successor administrator of such benchmark rate on such
successor’s website, is a relatively new interest rate index, and the way that SOFR and any market-accepted adjustments to SOFR are determined may change over time.
SOFR is intended to be a broad measure of the cost of borrowing cash overnight collateralized by U.S. Treasury securities. SOFR is calculated as a volume-weighted median of transaction-level tri-party repo
data collected from The Bank of New York Mellon as well as General Collateral Finance Repo transaction data and data on bilateral Treasury repo transactions cleared through The Fixed Income Clearing Corporation’s delivery-versus-payment
service. The FRBNY notes that it obtains information from DTCC Solutions LLC, an affiliate of The Depository Trust & Clearing Corporation. The FRBNY states on its publication page for SOFR that the use of SOFR is subject to important
limitations and disclaimers, including that the FRBNY may alter the methods of calculation, publication schedule, rate revision practices or availability of SOFR at any time without notice.
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SOFR is published by the FRBNY based on data received from sources outside of the sponsor and the issuing entity’s control or direction and neither the sponsor nor the issuing entity has control over its
determination, calculation or publication. In contrast to other indices, SOFR may be subject to direct influence by activities of the FRBNY, which may directly affect prevailing SOFR rates in ways the issuing entity is unable to predict.
There can be no guarantee that SOFR will not be discontinued or fundamentally altered in a manner that is materially adverse to the interests of the holders of the class A-6B or class A-6C notes. If the manner in which the SOFR calculation
is changed, it may result in a reduction of the amount of interest payable on and the trading prices of the class A-6B or class A-6C notes.
The FRBNY began to publish SOFR in April 2018, and the FRBNY has also been publishing historical indicative SOFR dating back to 2014. Potential investors should not rely on any historical changes or trends in
SOFR as an indicator of future changes or trends in SOFR. Due to the emerging and developing adoption of SOFR as an interest rate index, investors who desire to obtain financing for their class A-6B or class A-6C notes may have difficulty
obtaining any credit or credit with satisfactory interest rates, which may result in lower leveraged yields and lower secondary market prices upon the sale of the class A-6B or class A-6C notes.
The composition and characteristics of SOFR are not the same as those of LIBOR. First, SOFR is a secured rate, while LIBOR is an unsecured rate. Second, SOFR is an overnight rate, while LIBOR is a
forward-looking rate that represents interbank funding over different maturities (e.g., three months). Additionally, since the initial publication of SOFR, daily changes in SOFR have, on occasion, been more volatile than daily changes in
other benchmark or market rates, such as LIBOR. Although changes in the SOFR Rate, which is determined by reference to Compounded SOFR (as defined under “Description of the Notes—Determination of Indices”
in this free-writing prospectus), generally are not expected to be as volatile as changes in the daily levels of SOFR, the return on and value of the class A-6B or class A-6C notes may fluctuate more than floating rate debt securities that
are linked to less volatile rates. As a result, there can be no assurance that SOFR will perform in the same way as LIBOR would have at any time, including, without limitation, as a result of changes in interest and yield rates in the
market, market volatility or global or regional economic, financial, political, regulatory, judicial or other events.
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Reliance Upon Compounded
SOFR, And Any Adjustments
To The Methodology Used To
Determine Compounded
SOFR, May Adversely Affect
The Class A-6B Or The Class
A-6C Notes.
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The FRBNY began to publish, in March 2020, backward-looking compounded averages of SOFR, which are used to determine Compounded SOFR. It is possible that there will be limited interest in securities products
based on Compounded SOFR. In addition, forward-looking Term SOFR became available for use in cash products in 2021. It is possible that there will be relatively more interest in securities products based on Term SOFR as compared to
securities products based on Compounded SOFR. As a result, you should consider whether reliance on Compounded SOFR may adversely affect the market value and yield of the class A-6B or class A-6C notes due to potentially limited liquidity
and resulting constraints on available hedging and financing alternatives.
Navient Solutions, LLC, as administrator, may, from time to time and in its sole discretion, make conforming changes (i.e., technical, administrative or operational changes) without the consent of noteholders
or any other party, which could change the methodology used to determine Compounded SOFR. The issuing entity can provide no assurance that the methodology to calculate Compounded SOFR will not be adjusted as described in the prior sentence
and, if so adjusted, that the resulting interest rate will yield the same or similar economic results over the term of the class A-6B or class A-6C notes relative to the results that would have occurred had the interest rate been determined
without any such adjustment or that the market value of the class A-6B or class A-6C notes will not decrease due to any such adjustment. Holders of the class A-6B or class A-6C notes will not have any right to approve or disapprove of these
changes and will be deemed to have agreed to waive and release any and all claims relating to any such determinations.
You should carefully consider the foregoing uncertainties prior to investing in the notes. In general, events related to SOFR and alternative reference rates may adversely affect the liquidity, market value
and yield of your class A-6B or class A-6C notes.
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The Notes May Be Repaid
Early Due To An Auction Sale
Or The Exercise Of The
Optional Purchase Right. If
This Happens, Your Yield
May Be Affected And You
Will Bear Reinvestment Risk
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The notes may be repaid before you expect them to be if:
• the servicer exercises its option to purchase all of the trust student loans; or
• the indenture trustee successfully conducts an auction sale.
Either event would result in the early retirement of the notes outstanding on that date. If this happens, your yield on the notes may be affected. You will bear the risk that you cannot reinvest the money
you receive in comparable notes at an equal yield.
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Negative SOFR Rates Would
Reduce The Rate Of Interest
On The Notes
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For reset periods that commenced before July 2023, class A-6B and class A-6C notes accrued interest at a floating rate based on three-month LIBOR plus a spread. Commencing with the reset period that began on
July 25, 2023 and each subsequent reset period prior to a successful remarketing, the interest rate to be borne by each class of notes is currently based on the SOFR Rate plus a spread.
Changes in SOFR will affect the rate at which the notes accrue interest and the amount of interest payments on the notes. To the extent that the SOFR Rate decreases below 0.00% for any interest accrual
period, the SOFR Rate for such interest accrual period will be deemed to be 0.00% and the rate at which each class of notes accrue interest for such interest accrual period will be deemed to be 0.00% plus the applicable spread for each such
class of notes for the related interest accrual period.
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Investments May Be Subject
To An Array Of EU or UK
Investment Laws, Regulations
And Capital Requirements
And The Notes May Not Be A
Suitable Investment For Certain Investors Accordingly
|
All prospective investors in the notes whose investment activities are subject to legal investment laws and regulations, regulatory capital requirements, or review by regulatory authorities should consult
with their own legal, accounting and other advisors in determining whether, and to what extent, the notes will constitute legal investments for them or are subject to investment or other restrictions, unfavorable accounting treatment,
capital charges, reserve requirements or other consequences.
Investors should be aware of the risk retention and due diligence requirements (the “EU Risk Retention and Due Diligence Requirements”) which under Article 5 of Regulation (EU) 2017/2402 (the “EU
Securitization Regulation”) apply to certain types of EU-regulated investors including credit institutions and investment firms (and in each case certain consolidated affiliates thereof), institutions for occupational retirement,
alternative investment fund managers who manage or market alternative investment funds in the EU, insurance and reinsurance undertakings and management companies of UCITS funds (or internally managed UCITS) (“EU Institutional Investors”).
Amongst other things, the EU Risk Retention and Due Diligence Requirements restrict an EU Institutional Investor from investing in a securitization unless the EU Institutional Investor has verified that:
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(a) the originator or original lender of the underlying exposures of the securitization (if established outside of the EU) grants all the credits giving rise to the underlying exposures on the basis
of sound and well-defined criteria and clearly established processes for approving, amending, renewing and financing those credits and has effective systems in place to apply those criteria and processes to ensure that credit-granting is
based on a thorough assessment of the obligor’s creditworthiness;
(b) the originator, sponsor or original lender of the securitization (if established outside of the EU) (i) retains on an ongoing basis a material net economic interest which, in any event, shall not
be less than 5%, determined in accordance with Article 6 of the EU Securitization Regulation, and (ii) discloses the risk retention to EU Institutional Investors (the “EU Retention Requirement”); and
(c) (if established outside of the EU) the originator, sponsor or securitization special purpose entity (“SSPE”) has, where applicable, made available the information required by Article 7 of the EU
Securitization Regulation in accordance with the frequency and modalities provided for in Article 7 of the EU Securitization Regulation.
Investors should also be aware of the risk retention and due diligence requirements (the “UK Risk Retention and Due Diligence Requirements”) which, under Article 5 of the Securitisation (Amendment) (EU Exit)
Regulations 2019/660 (the “UK Securitization Regulation”), apply to certain types of UK regulated investors, including credit institutions and investment firms (and in each case certain affiliates thereof), institutions for occupational
retirement, alternative investment fund managers who manage or market alternative investment funds in the UK, insurance and reinsurance undertakings and management companies of UCITS funds (or internally managed UCITS) (“UK Institutional
Investors”). Among other things, the UK Risk Retention and Due Diligence Requirements restrict a UK Institutional Investor from investing in a securitization unless the UK Institutional Investor has verified that:
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(a) the originator or original lender of the securitization (if established outside of the UK) grants all the credits giving rise to the underlying exposures on the basis of sound and well-defined
criteria and clearly established processes for approving, amending, renewing and financing those credits and has effective systems in place to apply those criteria and processes to ensure that credit-granting is based on a thorough
assessment of the obligor’s creditworthiness;
(b) the originator, sponsor or original lender of the securitization (if established outside of the UK) (i) retains on an ongoing basis a material net economic interest which, in any event, shall
not be less than 5%, determined in accordance with Article 6 of the UK Securitization Regulation, and (ii) discloses the risk retention to UK Institutional Investors (the “UK Retention Requirement”); and
(c) (if established outside of the UK) the originator, sponsor or securitization special purpose entity issuer has made available information which is substantially the same as the information
required by Article 7 of the UK Securitization Regulation substantially in accordance with the frequency and modalities provided for in Article 7 of the UK Securitization Regulation.
Pursuant to The European Union (Withdrawal) Act 2018, the EU Securitization Regulation as applicable on April 30, 2021 was retained as part of the domestic law of the United Kingdom and amended by the
Securitisation (Amendment) (EU Exit) Regulations 2019 (as amended, the “UK Securitization Regulation”).
Failure on the part of an EU Institutional Investor or UK Institutional Investor to comply with one or more of the EU Risk Retention and Due Diligence Requirements or the UK Risk Retention and Due Diligence
Requirements (as applicable) may result in various sanctions or penalties including, in the case of those investors subject to regulatory capital requirements, the imposition of a punitive capital charge on the notes acquired by the
relevant investor.
None of the sponsor, the sellers, the depositor and the initial purchasers or any other person intends to retain a material net economic interest in the securitization constituted by the issuance of the notes
in a manner that would satisfy the EU Retention Requirement or to the UK Retention Requirement or take any other action which may be required by EU Institutional Investors or the UK Risk Retention and Due Diligence Requirements respectively
for the purposes of their compliance with the EU Risk Retention and Due Diligence Requirements, and no such person assumes (i) any obligation to so retain or take any such other action or (ii) any liability whatsoever in connection with any
Holder’s non-compliance with the EU Risk Retention and Due Diligence Requirements or the UK Risk Retention and Due Diligence Requirements. Consequently, the notes may not be a suitable investment for EU Institutional Investors or UK
Institutional Investors. As a result, the price and liquidity of the notes in the secondary market may be adversely affected.
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Your Notes Are Subject To A
Call Option
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Navient Corporation, or one of its wholly-owned subsidiaries, has the option to call, in full, the class A-6B or class A-6C notes in respect of each reset date, even if you have delivered a hold notice. If
this option is exercised, you will receive a payment of principal equal to the outstanding principal balance of your class A-6B or class A-6C notes, as applicable, less all amounts distributed to you as a payment of principal, plus all
accrued and unpaid interest on such distribution date. However, you may not be able to reinvest the proceeds you receive in a comparable security with an equivalent yield. For additional information concerning the call option and reset
periods, see “Description of the Notes—The Reset Rate Notes” in this free-writing prospectus.
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You May Be Required To
Continue To Hold Your Notes
If A Failed Remarketing
Occurs With Respect To A
Reset Date
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In connection with any remarketing of the class A-6B or class A-6C notes (including on the current reset date), if a failed remarketing is declared, your class A-6B or class A-6C notes will not be sold, even
if you attempted to tender them for remarketing or if the notes were mandatorily tendered with respect to such reset date. In this event you will be required to rely on a sale through the secondary market, which may not then exist for your
class A-6B or class A-6C notes, independent of the remarketing process.
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If a failed remarketing is declared with respect to the January 25, 2024 reset date, the class A-6B and class A-6C notes will bear interest until the next reset date at the failed remarketing rate, which is
currently equal to an annual rate of the SOFR Rate plus 0.75%. We cannot assure you that the failed remarketing rate will be as high as the prevailing market rate of interest for similar securities and you may suffer a loss in yield. For
additional information concerning a failed remarketing, see “Description of the Notes—The Reset Rate Notes” in this free-writing prospectus.
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You May Experience
Notification Delays In
Connection With A
Remarketing Of Your Notes
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Holders of beneficial interests in the class A-6B and class A-6C notes may not receive timely notifications of the reset terms for any reset date due to procedures used by the clearing agencies and financial
intermediaries. If you do not receive a copy of the notice delivered on the related remarketing terms determination date, you will nevertheless be deemed to have tendered your class A-6B or class A-6C notes unless the remarketing agent has
received a hold notice from you on or prior to the related notice date.
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Risks Relating To Student
Loans
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You Will Bear Prepayment
And Extension Risk Due To
Actions Taken By Individual
Borrowers And Other
Variables Beyond Our
Control
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A borrower may prepay a student loan in whole or in part at any time. The rate of prepayments on the trust student loans may be influenced by a variety of economic, social, competitive and other factors,
including changes in interest rates, the availability of alternative financings (including, without limitation, refinancings offered through the Department of Education’s Direct Loan program), regulatory changes affecting the student loan
market and the general economy. Various loan consolidation or refinance programs, including those offered by affiliates of the depositor, available to eligible borrowers may increase the likelihood of prepayments. For example, recently,
the Department of Education announced a set of policy changes and in connection therewith, released negotiated rulemaking proposals relating to the Public Service Loan Forgiveness program under its Direct Loan program, which may result in
an increase in consolidations of FFELP loans into Direct Loans. While implementation of the policy changes and final new regulations are unknown at this time, individually or collectively, an increase in loan consolidations may cause higher
than anticipated prepayment rates on the trust student loans. Further, other current and future initiatives by Congress or future laws, executive orders or other policy statements to encourage or force consolidation, create debt forgiveness
programs or establish other policies and programs including but not limited to those proposed by several presidential campaigns could also affect prepayments on the trust student loans. In addition, the issuing entity may receive
unscheduled payments due to borrower defaults and purchases by the servicer or the depositor. Because a pool may include thousands of trust student loans, it is impossible to predict if or when or in what form any of these future actions
may occur or to predict the amount and timing of payments that will be received and paid to noteholders in any period. Consequently, the length of time that your notes are outstanding and accruing interest may be shorter than you expect.
On the other hand, borrowers of trust student loans might not choose to prepay their trust student loans or the trust student loans may be extended as a result of grace periods, deferment periods, forbearance
periods, income-driven repayment plans or repayment term or monthly payment amount modifications agreed to by the servicer in compliance with laws and regulations. This may slow the expected timing of principal payments or lengthen the
remaining term of the trust student loans and delay principal payments to you. In addition, the amount available for distribution to you will be reduced if borrowers fail to pay timely the principal and interest due on the trust student
loans. Consequently, the length of time that your notes are outstanding and accruing interest may be longer than you expect.
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The optional purchase right of the servicer and the provision for the auction of the trust student loans, create additional uncertainty regarding the timing of payments to noteholders.
The effect of these factors is impossible to predict. To the extent they create reinvestment risk, you will bear that risk.
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A Failure To Comply With
Student Loan Origination And
Servicing Procedures Could
Jeopardize Guarantor,
Interest Subsidy And Special Allowance Payments On The
Trust Student Loans That Are
FFELP Loans Or Otherwise
Have An Adverse Impact On
The Trust Student Loans,
Which May Result In Delays
In Payment Or Losses On
Your Notes
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The rules under which the trust student loans were originated, including the Higher Education Act or the program rules require lenders making and servicing student loans and the guarantors guaranteeing those
loans to follow specified procedures, including due diligence procedures, to ensure that the student loans are properly made, disbursed and serviced.
Failure to follow these procedures may result in the Department of Education’s refusal to make reinsurance payments to the applicable guarantor or to make interest subsidy payments and special allowance
payments on the trust student loans that are FFELP Loans.
Loss of any loan program payments could adversely affect the amount of available funds and the issuing entity’s ability to pay principal and interest on your notes.
In addition, to the extent related to servicing practices of Navient Solutions, LLC with respect to FFELP loans or HEAL Program, an adverse ruling in litigation against Navient Solutions, LLC may have a
material adverse effect on the trust student loans, and the payments on your notes may be adversely affected. See “Navient Corporation” in this free-writing prospectus.
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The Inability Of The
Depositor Or The Servicer To
Meet Its Repurchase
Obligation May Result In
Losses On Your Notes |
Under some circumstances, the issuing entity has the right to require the depositor (and the depositor has the right to require the sellers) or the servicer to purchase a trust student loan or provide the
issuing entity with a substitute student loan. This right arises generally if a breach of the representations, warranties or covenants of the depositor or the servicer, as applicable, has a material adverse effect on the issuing entity,
and is not cured within the applicable cure period. We cannot guarantee to you, however, that the depositor (and, in turn, the sellers) or the servicer will have the financial resources to make a purchase or substitution.
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For example, the depositor, the sellers, and the servicer are subsidiaries of Navient Corporation and, as a result, an adverse ruling in litigation against Navient Corporation could also give rise to an
obligation of the depositor, the servicer, or a seller to purchase, repurchase, or substitute trust student loans as set forth in the related transaction documents and may have an adverse impact on the financial ability of the depositor,
the servicer, or a seller to fulfill their respective obligations to purchase, repurchase or substitute trust student loans. See “Navient Corporation” in this free-writing prospectus.
If the depositor, the sellers, or the servicer do not have the financial resources to make a required purchase or substitution, you will bear any resulting loss.
|
||
Incentive Programs May
Affect Your Notes
|
At the present time, the borrowers with respect to certain of the initial trust student loans may be eligible for various incentive programs. In addition, under the terms of the servicing agreement, the
servicer may make new incentive programs available to borrowers with trust student loans. See “The Companies’ Student Loan Financing Business—Servicing—Incentive Programs” in this free-writing
prospectus. These current or future incentive programs may affect payments on your notes.
For example, if one or more of the incentive programs which offer a principal balance reduction to borrowers are made available to borrowers with trust student loans and a higher than anticipated number of
borrowers qualify, the principal balance of the affected trust student loans may repay faster than anticipated.
Accordingly, your notes may experience faster than anticipated principal payments.
Conversely, the existence of these incentive programs may discourage a borrower from prepaying an affected trust student loan. If this were to occur, the principal balance of your notes may be reduced over a
longer period than would be the case if there were no such incentive program.
Furthermore, incentive programs may reduce the amount of funds available to make payments on your notes by reducing the principal balances and yield on the trust student loans. In that case, you will bear
the risk of any loss not covered by available credit enhancement.
|
|
A Servicer Default May
Result In Additional Costs,
Increased Servicing Fees By
A Substitute Servicer Or A
Diminution In Servicing
Performance, Any Of Which
May Have An Adverse Effect
On Your Notes |
If a servicer default occurs, the indenture trustee or the noteholders may remove the servicer without the consent of the eligible lender trustee. Only the indenture trustee or such noteholders, and not the
eligible lender trustee, has the ability to remove the servicer if a servicer default occurs. In the event of the removal of the servicer and the appointment of a successor servicer, we cannot predict:
|
• the ability of the successor servicer to perform the obligations and duties of the servicer under the servicing agreement; or
• the servicing fees charged by the successor servicer.
In addition, the noteholders have the ability, with some exceptions, to waive defaults by the servicer.
Furthermore, the indenture trustee or the noteholders may experience difficulties in appointing a successor servicer and during any transition phase it is possible that normal servicing activities could be
disrupted, resulting in increased delinquencies and/or defaults on the trust student loans.
|
||
The Indenture Trustee May
Have Difficulty Liquidating
Trust Student Loans After An
Event Of Default
|
If an event of default occurs under the indenture, the indenture trustee may sell the trust student loans, without the consent of the noteholders (but only in the event that there has been a payment default
on the class A notes, and in all other cases, if the purchase price received from the sale of the trust student loans is sufficient to repay all noteholders in full). However, the indenture trustee may not be able to find a purchaser for
the trust student loans in a timely manner or the market value of those loans may not be high enough to make noteholders whole.
|
|
You May Incur Losses Or
Delays In Payments On Your
Notes If Borrowers Default
On The Trust Student Loans
|
If a borrower defaults on a trust student loan that is only 98% or 97% guaranteed, the related issuing entity will experience a loss of approximately 2% or 3%, as the case may be, of the outstanding principal
and accrued interest on that student loan. If defaults occur on the trust student loans and the credit enhancement described in this free-writing prospectus is insufficient, you may suffer a delay in payment or losses on your notes.
|
|
If A Guarantor Of The Trust
Student Loans Experiences
Financial Deterioration Or
Failure, You May Suffer
Delays In Payment Or Losses
On Your Notes
|
All of the trust student loans will be unsecured. As a result, the only security for payment of a FFELP guaranteed student loan is the guarantee provided by the applicable guarantor. FFELP loans acquired by
the issuing entity may be subject to guarantee agreements with a number of individual guarantors. A deterioration of a guarantor’s financial condition and ability to honor guarantee claims could result in a failure of that guarantor to
make guarantee payments to the eligible lender trustee in a timely manner, or at all. The financial condition of a guarantor could be adversely affected by a number of factors, including the amount of claims made against that guarantor as
a result of borrower defaults.
A guarantor’s financial condition and ability to honor guarantee claims with respect to FFELP loans could also be adversely affected by a number of other factors including:
|
• the continued voluntary waiver by the guarantor of the guarantee fee payable by a borrower upon disbursement of a student loan;
• the amount of claims made against that guarantor as a result of borrower defaults;
• the amount of claims reimbursed to that guarantor from the Department of Education, which range from 75% to 100% of the guaranteed portion of the loan, depending on the date the loan
was made and the historical performance of the guarantor; and
• changes in legislation that may reduce expenditures from the Department of Education that support federal guarantors or that may require guarantors to pay more of their reserves to
the Department of Education.
If the financial condition of a guarantor deteriorates, it may fail to make guarantee payments in a timely manner, or at all. In that event, you may suffer delays in payment or losses on your notes.
|
||
The Department Of
Education’s Failure To Make
Reinsurance Payments May
Negatively Affect The Timely
Payment Of Principal And
Interest On Your Notes
|
If a guarantor is unable to meet its guarantee obligations, the issuing entity may submit claims directly to the Department of Education for payment. The Department of Education’s obligation to pay guarantee
claims directly is dependent upon its determination that the guarantor is unable to meet its guarantee obligations. If the Department of Education delays in making this determination, you may suffer a delay in the payment of principal and
interest on your notes. In addition, if the Department of Education determines that the guarantor is able to meet its guarantee obligations, the Department of Education will not make guarantee payments to the issuing entity. The Department
of Education may or may not make the necessary determination that the guarantor is unable to meet its guarantee obligations. If the Department of Education determines that the guarantor is unable to meet its guarantee obligations, it may
or may not make this determination or the ultimate payment of the guarantee claims in a timely manner. This could result in delays or losses on your investment.
|
Payment Offsets By
Guarantors Or The
Department Of Education
Could Prevent The Issuing
Entity From Paying You The
Full Amount Of The Principal
And Interest Due On Your
Notes
|
The eligible lender trustee may use the same Department of Education lender identification number for FFELP loans of the issuing entity as it uses for other FFELP loans it holds on behalf of other issuing
entities established by the sponsor. If it does, the billings submitted by the eligible lender trustee or the servicer to the Department of Education (for items such as special allowance payments or interest subsidy payments) and the
claims submitted to the guarantors will be consolidated with the billings and claims for payments for trust student loans under other issuing entities using the same lender identification number. Payments on those billings by the Department
of Education as well as claim payments by the applicable guarantors will be made to the eligible lender trustee, or to the servicer on behalf of the eligible lender trustee, in a lump sum. Those payments must be allocated by the
administrator among the various issuing entities that reference the same lender identification number.
If the Department of Education or a guarantor determines that the eligible lender trustee owes it a liability on any trust student loan, including loans it holds on behalf of the issuing entity for your notes
or other issuing entities, the Department of Education or the applicable guarantor may seek to collect that liability by offsetting it against payments due to the eligible lender trustee of the issuing entity. Any offsetting or shortfall
of payments due to the eligible lender trustee could adversely affect the amount of available funds for any collection period and thus the issuing entity’s ability to pay you principal and interest on your notes.
The servicing agreement for your notes contains provisions for cross-indemnification concerning those payments and offsets. Such provisions require one entity to compensate the other or accept a lesser
payment to the extent the latter has been assessed for the liability of the former. Even with cross-indemnification provisions, however, the amount of funds available to the issuing entity from indemnification would not necessarily be
adequate to compensate the issuing entity and investors in the notes for any previous reduction in the available funds.
|
|
The Enactment Of The Health
Care And Education
Reconciliation Act Of 2010
And Any Other Future
Changes In Law May
Adversely Affect Student
Loans, The Guarantors, The
Depositor or Navient CFC
And, Accordingly, Adversely
Affect Your Notes
|
On March 30, 2010, the Health Care and Education Reconciliation Act of 2010 (the “Reconciliation Act”) was enacted into law. Effective July 1, 2010, the Reconciliation Act eliminated the FFELP. The terms of
existing FFELP loans are not materially affected by the Reconciliation Act. The Higher Education Act or other relevant federal or state laws, rules and regulations may be further amended or modified in the future in a manner, including as
part of any reauthorization of the Higher Education Act, that could adversely affect the federal student loan programs as well as the student loans made under these programs and the financial condition of the guarantors. Among other
things, the level of guarantee payments may be adjusted from time to time. The elimination of FFELP and any other future changes could affect the ability of Navient CFC, the depositor or the servicer to satisfy their obligations to purchase
or substitute student loans. Future changes could also have a material adverse effect on the revenues received by the guarantors that are available to pay claims on defaulted student loans in a timely manner. We cannot predict whether any
changes will be adopted or, if adopted, what impact those changes would have on any issuing entity or the notes.
|
The Use Of Master
Promissory Notes May
Compromise The Indenture
Trustee’s Security Interest In
The Student Loans
|
For loans disbursed on or after July 1, 1999, a master promissory note evidences any student loan made to a borrower under the Federal Family Education Loan Program. When a master promissory note is used, a
borrower executes only one promissory note with each lender. Subsequent student loans from that lender are evidenced by a confirmation sent to the student. Therefore, if a lender originates multiple student loans to the same student, all of
the related student loans are evidenced by a single promissory note.
Under the Higher Education Act, each student loan made under a master promissory note may be sold independently of any other student loan made under that same master promissory note. Each student loan is
separately enforceable on the basis of an original or copy of the master promissory note.
It is possible that student loans transferred to the issuing entity may be originated under a master promissory note. If the servicer were to deliver a copy of the master promissory note, in exchange for
value, to a third-party that did not have knowledge of the indenture trustee’s lien, that third-party may also claim an interest in the student loan. It is possible that the third-party’s interest could be prior to or on parity with the
interest of the indenture trustee.
|
|
The Trust May Be Affected
By Delayed Payments From
Borrowers Called To Active
Military Service
|
The Servicemembers Civil Relief Act and similar state and local laws provide payment relief to borrowers who enter active military service and to borrowers in reserve status who are called to active duty
after the origination of their trust student loans. Military operations by the United States may increase the number of citizens who are in active military service, including persons in reserve status who have been called or may be called
to active duty.
|
|
Certain Credit And Liquidity Enhancement Features Are
Limited And If They Are
Partially Or Fully Depleted,
There May Be Shortfalls In
Distributions To Noteholders
|
Certain credit and liquidity enhancement features, including the reserve account, are limited in amount. In certain circumstances, if there is a shortfall in available funds, such amounts may be partially or
fully depleted. This depletion could result in shortfalls and delays in distributions to noteholders.
|
|
The Notes May Be Assigned
Lower Ratings Than Those
Described In This Free-
Writing Prospectus By
Different Rating Agencies
|
The sponsor, or an affiliate, paid a fee to two or more NRSROs (the “Rating Agencies”) to assign the initial credit ratings to the notes on or before the closing date. The SEC has said that being paid by the
sponsor, issuer or remarketing agent to issue or maintain a credit rating on asset-backed securities creates a conflict of interest for NRSROs, and that this conflict is particularly acute because arrangers of asset-backed securities
transactions provide repeat business to such NRSROs.
|
The sponsor has not requested a rating of the notes by any NRSRO other than the Rating Agencies. However, in preparing for the offering, the sponsor may have had discussions with, and received preliminary
feedback from, NSROs other than the Rating Agencies. Other NRSROs may assign their own ratings to any class or classes of notes at any time, even prior to the closing date. NRSROs have different methodologies, criteria, models and
requirements, which may result in ratings that are lower than those assigned by the Rating Agencies. Depending upon the level of the ratings assigned, what NRSROs are involved, what their stated reasons are for assigning a lower rating,
and other factors, if a NRSRO issues a lower rating, the liquidity, market value and regulatory characteristics of the particular class or classes of notes could be materially and adversely affected. In addition, the mere possibility that
such a rating could be issued may affect price levels in any secondary market that may develop.
|
||
Current General Economic
Conditions, Or A Further
Deterioration of Economic
Conditions May Reduce
Payments on Your Notes
|
Current general economic conditions, or a further deterioration in economic conditions in the United States or globally, such as a further increase in unemployment levels, contraction of the availability of
consumer credit or a continued increase in interest rates, may be caused by a variety of factors, including but not limited to, political gridlock on United States federal budget matters (including full or partial government shutdowns),
public health emergencies such as the ongoing global outbreak of the 2019 novel coronavirus disease (also known as “COVID-19”), trade disputes, terrorist events, wars, and other military or civil conflicts, price volatility in commodities,
natural disasters and other disruptive political, social or economic events. Any such disruption in economic activities may be severe or unpredictable, and could adversely affect the ability and willingness of borrowers to meet their
payment obligations under the trust student loans or of the servicer to operate its business and manage and service the trust student loans, possibly resulting in higher rates of delinquencies and greater losses experienced by the trust
with respect to the trust student loans. An increase in defaults on the trust student loans, or a decrease or delay in the amount of interest or principal received on the trust student loans, either alone or in combination, could negatively
affect the ability of the trust to generate sufficient cash flow to pay its obligations or the ability of the servicer to service the interest and principal payments due on the notes, which, in turn, may cause losses on the notes.
An improvement in economic conditions could result in prepayments by the borrowers of their payment obligations under the trust student loans. As a result, you may receive principal payments of your notes
earlier than anticipated.
|
• |
acquiring, holding and managing the trust student loans and the other assets of the trust and related proceeds;
|
• |
issuing the notes;
|
• |
making payments on the notes;
|
• |
if applicable, entering into swap agreements from time to time with respect to the reset rate notes and making the required payments set forth therein;
|
• |
entering into any potential future interest rate cap agreements at the direction of the administrator from time to time and making the payments, including any upfront payments, required thereunder; and
|
• |
engaging in other activities that are necessary, suitable or convenient to accomplish, or are incidental to, the foregoing.
|
• |
the pool of trust student loans, legal title to which is held by the eligible lender trustee on behalf of the trust;
|
• |
all funds collected on trust student loans, including any special allowance payments and interest subsidy payments, on or after the applicable cutoff date;
|
• |
all moneys and investments from time to time on deposit in the Trust Accounts;
|
• |
if applicable, its rights under any and all swap agreements entered into from time to time with respect to a class of reset rate notes and the related documents;
|
• |
if applicable, its rights under any potential future interest rate cap agreement entered into from time to time and the related documents;
|
• |
its rights under the transfer and servicing agreements, including the right to require VG Funding (or Navient Solutions, LLC, as servicer, acting on its behalf), Navient CFC, the depositor or the servicer to repurchase trust student
loans from it or to substitute student loans under certain conditions; and
|
• |
its rights under the guarantee agreements with guarantors.
|
$
|
0.00
|
|||
Floating Rate Class A‑2 Student Loan‑Backed Notes
|
0.00
|
|||
Floating Rate Class A‑3 Student Loan‑Backed Notes
|
0.00
|
|||
Floating Rate Class A-4 Student Loan‑Backed Notes
|
0.00
|
|||
Floating Rate Class A‑5 Student Loan‑Backed Notes
|
0.00
|
|||
Floating Rate Class A-6A Student Loan-Backed Notes
|
243,878,335.17
|
|||
Reset Rate Class A-6B Student Loan-Backed Notes
|
127,369,569.17
|
|||
Reset Rate Class A-6C Student Loan-Backed Notes
|
127,369,569.17
|
|||
Floating Rate Class B Student Loan‑Backed Notes
|
32,748,991.96
|
|||
Initial Equity
|
100.00 |
|||
Total
|
$
|
548,565,864.57
|
• |
was a consolidation loan 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 fully disbursed;
|
• |
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.
|
Disbursement Date |
Percentage
Guaranteed
|
|
Prior to October 1, 1993
|
100%
|
|
On or after October 1, 1993 but before July 1, 2006
|
98%
|
• |
the origination and servicing of the trust student loan being performed in accordance with the FFELP, the Higher Education Act, the guaranty agency’s rules and other applicable requirements;
|
• |
the timely payment to the guaranty agency of the guarantee fee payable on the trust student loan; and
|
• |
the timely submission to the guaranty agency of all required pre-claim delinquency status notifications and of the claim on the trust student loan.
|
• |
commercial banks, thrift institutions and credit unions;
|
• |
pension funds and insurance companies;
|
• |
educational institutions;
|
• |
various state and private nonprofit loan originating and secondary market agencies; and
|
• |
various other third parties.
|
• |
shortly after loan origination;
|
• |
while the borrowers are still in school;
|
• |
just before the loan’s conversion to repayment after borrowers graduate or otherwise leave school; or
|
• |
while the loans are in repayment.
|
• |
its automated loan administration system called PortSS® for the lender to use prior to loan sale; or
|
• |
its loan origination and interim servicing system called ExportSS®.
|
• |
Undergraduate and Graduate Loan Programs;
|
• |
Law Loan Programs;
|
• |
MBA Loan Programs;
|
• |
Medical Loan Programs;
|
• |
Dental Loan Programs;
|
• |
Direct-to-Consumer Loan Programs;
|
• |
Private Consolidation Loan Program;
|
• |
Career Training Loan Program;
|
• |
EFG Loan Programs;
|
• |
Smart Option Student Loan Program; and
|
• |
Private Education Refi Loan Program.
|
• |
Great Rewards(SM). Under the Great Rewards(SM) program, which is available for
all student loans that were disbursed prior to June 30, 2002 and enter repayment after July 1993, if a borrower makes 48 consecutive scheduled payments in a timely fashion, the effective interest rate is reduced permanently by 2% per
annum.
|
• |
Great Returns(SM). Under the Great Returns(SM) program, borrowers whose loans
were disbursed prior to June 30, 2002 and who make 24 consecutive scheduled payments in a timely fashion get a reduction in principal equal to any amount over $250 that was paid as part of the borrower’s origination fee to the extent
that the fee does not exceed 3% of the principal amount of the loan.
|
• |
Direct Repay/ ACH Benefit plan. Under the Direct Repay/ ACH Benefit plan, borrowers who make student loan payments
electronically through automatic monthly deductions from a savings, checking or NOW account receive a 0.25% or 0.50% effective interest rate reduction as long as loan payments continue to be successfully deducted from the borrower’s
bank account.
|
• |
Cash Back plan. Under the Cash Back plan, borrowers (i) whose loans are with a Company lender partner, (ii) who enroll
in Manage Your Loans(SM), the servicer’s on-line account manager, (iii) who agree to receive their account information by e-mail and (iv) who make their first 33 scheduled payments on time, receive a 3.3% check or credit based upon
their original loan amount.
|
• |
Federal Student Loan Consolidation Incentive. Borrowers with an initial consolidation loan balance of at least $10,000
who make their first 36 payments on time receive a 1.0% interest rate reduction during periods of active repayment.
|
• |
On-Time Payment Interest Rate Reduction plan. Under the On-Time Payment Interest Rate Reduction plan, borrowers who make
their first 24 scheduled payments on time, sign-up for on-line loan management within 60 days from the first payment due date and continue to make payments on time, receive a 0.5% effective interest rate reduction.
|
• |
each student loan was free and clear of all security interests and other encumbrances and no offsets, defenses or counterclaims had been asserted or threatened;
|
• |
the information provided about the student loans was true and correct as of the original cutoff date;
|
• |
each student loan complied in all material respects with applicable federal and state laws and applicable restrictions imposed by the FFELP or under any guarantee agreement; and
|
• |
each student loan was guaranteed by the applicable guarantor.
|
• |
the shortfall, if any, between:
|
o |
the purchase amount of the qualified substitute student loans,
|
o |
the purchase amount of the trust student loans being replaced; plus
|
• |
any accrued interest amounts not guaranteed by, or that are required to be refunded to, a guarantor and any interest subsidy payments or special allowance payments lost as a result of the breach.
|
• |
the maturity or other liquidation of the last trust student loan and the disposition of any amount received upon liquidation of any remaining trust student loan, and
|
• |
the payment to the noteholders of all amounts required to be paid to them.
|
• |
collecting and depositing into the collection account all payments on the trust student loans, including claiming and obtaining any program payments;
|
• |
responding to inquiries from borrowers;
|
• |
attempting to collect delinquent payments; and
|
• |
sending out statements and payment coupons to borrowers.
|
• |
it will satisfy all of its obligations relating to the trust student loans, maintain in effect all qualifications required in order to service the loans and comply in all material respects with all requirements of law if a failure to
comply would have a materially adverse effect on the interests of the trust;
|
• |
it will not permit any rescission or cancellation of a trust student loan except as ordered by a court or other government authority or as consented to by the eligible lender trustee and the indenture trustee, except that it may write
off any delinquent loan if the remaining balance of the borrower’s account is less than $50;
|
• |
it will do nothing to impair the rights of the noteholders in the trust student loans; and
|
• |
it will not reschedule, revise, defer or otherwise compromise payments due on any trust student loan except during any applicable interest only, deferment or forbearance periods or otherwise in accordance with the same standards it
uses for similar student loans owned by Navient and its affiliates.
|
• |
the shortfall, if any, between:
|
o |
the purchase amount of the qualified substitute trust student loans;
|
o |
the purchase amount of the trust student loans being replaced; and
|
• |
any accrued interest amounts not guaranteed by or that are required to be refunded to a guarantor and any interest subsidy payments or special allowance payments lost as a result of a breach.
|
• |
the successor to the servicer’s operations assumes in writing all of the obligations of the servicer;
|
• |
the sale or transfer and the assumption comply with the requirements of the servicing agreement; and
|
• |
the rating agencies confirm that this will not result in a downgrading or a withdrawal of the ratings then applicable to the notes.
|
• |
its obligation to purchase trust student loans from the trust as required by the servicing agreement or to pay to the trust the amount of any program payment which a guarantor or the Department of Education refuses to pay, or requires
the trust to refund, as a result of the servicer’s actions; or
|
• |
any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of the servicer’s duties or because of reckless disregard of its obligations and duties.
|
• |
any failure by the servicer to deposit in the Trust Accounts any required payment that continues for five Business Days after the servicer receives written notice of such failure from the indenture trustee or the eligible lender
trustee;
|
• |
any failure by the servicer to observe or perform in any material respect any other term, covenant or agreement in the servicing agreement that materially and adversely affects the rights of noteholders and continues for 60 days after
written notice of such failure is given (1) to the servicer by the indenture trustee, the eligible lender trustee, or the administrator or (2) to the servicer, the indenture trustee and the eligible lender trustee, by holders of 50% or
more of the notes;
|
• |
the occurrence of an insolvency event involving the servicer;
|
• |
any failure by the servicer to comply with any requirements under the Higher Education Act resulting in a loss of its eligibility as a FFELP loan servicer; or
|
• |
any failure by the servicer to deliver any particular information, report, certification or accountants’ letter when and as required by specified sections of the servicing agreement, which continues unremedied for fifteen (15) calendar
days after the date on which such information, report, certification or accountants’ letter was required to be delivered.
|
• |
directing the indenture trustee to make the required distributions from the Trust Accounts on each monthly servicing payment date and each distribution date;
|
• |
preparing, based on periodic data received from the servicer, and providing quarterly and annual distribution statements to the eligible lender trustee, and the indenture trustee and any related U.S. federal income tax reporting
information; and
|
• |
providing the notices and performing other administrative obligations required by the indenture, the trust agreement and the sale agreement.
|
• |
the sub-administrator assumes in writing all of the obligations of the administrator that are sub-contracted;
|
• |
the sub-administrator covenants to comply with the requirements of the administration agreement; and
|
• |
the rating agencies confirm that this will not result in a downgrading or a withdrawal of the ratings then applicable to the notes.
|
• |
any failure by the administrator to deliver to the indenture trustee for deposit any required payment by the Business Day preceding any monthly servicing payment date or distribution date, if the failure continues for five Business
Days after notice or discovery;
|
• |
any failure by the administrator to direct the indenture trustee to make any required distributions from any of the Trust Accounts on any monthly servicing payment date or any distribution date, if the failure continues for five
Business Days after notice or discovery;
|
• |
any failure by the administrator to observe or perform in any material respect any other term, covenant or agreement in the administration agreement or a related agreement that materially and adversely affects the rights of noteholders
and continues for 60 days after written notice of the failure is given:
|
o |
to the administrator by the indenture eligible lender trustee, or
|
o |
to the administrator, the indenture trustee or the eligible lender trustee, as applicable, by holders of 50% or more of the notes; or
|
• |
the occurrence of an insolvency event involving the administrator.
|
• |
the amount of principal distributions for each class of notes;
|
• |
the amount of interest distributions for each class of notes and the applicable interest rates;
|
• |
the Pool Balance at the beginning and at the end of the preceding collection period;
|
• |
the outstanding principal balance and the note pool factor for each class of notes for that distribution date;
|
• |
the servicing fees, the administration fees and the amount of any carryover servicing fees for that collection period;
|
• |
the interest rates, if available, for the next period for each class of notes or the website where those rates may be found;
|
• |
the amount of any aggregate Realized Losses on the trust student loans for that collection period;
|
• |
the amount of any note interest shortfall and note principal shortfall, if applicable, for each class of notes, and any changes in these amounts from the preceding statement;
|
• |
the amount of any note interest carryover, if applicable, for each class of notes, and any changes in these amounts from the preceding statement;
|
• |
the aggregate purchase amounts for any trust student loans repurchased by the depositor, the servicer or the sellers from the trust in that collection period;
|
• |
the balance of trust student loans that are delinquent in each delinquency period as of the end of that collection period;
|
• |
the balance of any reserve account after giving effect to changes in the balance on that distribution date;
|
• |
to the extent applicable, any amount drawn upon from any reserve account with respect to such distribution date;
|
• |
any applicable triggers or asset tests are then in effect;
|
• |
if applicable, the amount of trust student loans added during the supplemental purchase period and the amount of any required repurchases or substitutions of trust student loans, to the extent material, and the balance of any Trust
Accounts as of both the prior and current distribution dates; and
|
• |
amounts distributed to the holder of the excess distribution certificate and the uses of Available Funds to the extent not otherwise set forth above.
|
• |
borrower default, death, disability or bankruptcy;
|
• |
the closing of the borrower’s school;
|
• |
the school’s false certification of borrower eligibility;
|
• |
liquidation of the student loan or collection of the related guarantee payments; and
|
• |
purchase of a student loan by the depositor or the servicer.
|
• |
the original denomination of your note; and
|
• |
the applicable pool factor.
|
Class of Notes
|
Spread
|
|
Class A-6A
|
plus 0.16%
|
Class | Spread | |
Class A-6B
|
plus %
|
|
Class A-6C
|
plus %
|
• |
the outstanding principal balance of the trust student loans plus
|
• |
any accrued but unpaid interest on the trust student loans as of the last day of the related collection period plus
|
• |
the balance of the reserve account on the distribution date following those distributions made under clauses (a) through (f) under “—Distributions—Distributions from the Collection Account”
below minus
|
• |
the Specified Reserve Account Balance and the Supplemental Interest Account Deposit Amount for that distribution date, or
|
• |
if such reset rate notes are denominated in U.S. Dollars, a 360-day year consisting of twelve 30-day months; or
|
• |
if such reset rate notes are denominated in a currency other than U.S. Dollars, generally, the Actual/Actual (ISMA) accrual method as described in “—Determination of Indices” below or another
day-count convention as set forth on the related Remarketing Terms Determination Date.
|
• |
the remarketing agent, in consultation with the administrator, with respect to the length of the reset period, the applicable currency (U.S. Dollars, Euros, Pounds Sterling or another currency), whether the interest rate is fixed or
floating and, if floating, the applicable interest rate index, the day-count convention, the applicable interest rate determination dates, the interval between interest rate change dates during each accrual period, whether the reset rate
notes will be structured to amortize periodically or to receive a payment of principal only at the end of the reset period, and the related All Hold Rate (if applicable); and
|
• |
the remarketing agent with respect to the determination of the applicable fixed rate of interest or Spread to the chosen interest rate index, as applicable.
|
• |
at a floating interest rate, in which case such reset rate notes are said to be in floating rate mode, or
|
• |
at a fixed interest rate, in which case such reset rate notes are said to be in fixed rate mode,
|
• |
the weighted average life of such reset rate notes under several assumed prepayment scenarios;
|
• |
the name and contact information of the remarketing agent;
|
• |
the next reset date and reset period;
|
• |
the applicable minimum denomination and additional increments;
|
• |
the interest rate mode (i.e., fixed rate or floating rate);
|
• |
the applicable currency;
|
• |
if in foreign exchange mode, the identities of the Eligible Swap Counterparties from which bids will be solicited;
|
• |
if in foreign exchange mode, the applicable distribution dates on which interest and principal will be paid to the related reset rate noteholders, if other than quarterly;
|
• |
whether such reset rate notes will be structured to amortize periodically or to receive a payment of principal only at the end of the related reset period (as will be the case, generally, but not exclusively, whenever such reset rate
notes bear a fixed rate of interest);
|
• |
if in floating rate mode, the applicable interest rate index;
|
• |
if in floating rate mode, the interval between interest rate change dates;
|
• |
if in floating rate mode, the applicable interest rate determination date;
|
• |
if in fixed rate mode, the applicable fixed rate pricing benchmark;
|
• |
if in fixed rate mode, the identities of the Eligible Swap Counterparties from which bids will be solicited;
|
• |
if in floating rate mode, whether there will be a swap agreement and if so the identities of the Eligible Swap Counterparties from which bids will be solicited;
|
• |
the applicable interest rate day-count basis; and
|
• |
the related All Hold Rate, if applicable.
|
• |
the remarketing agent, in consultation with the administrator, cannot determine the applicable required reset terms on or before the remarketing terms determination date;
|
• |
the remarketing agent cannot establish the required spread on the spread determination date;
|
• |
the remarketing agent is unable to remarket some or all of the tendered reset rate notes at the spread set by the remarketing agent, or one or more committed purchasers default on their purchase obligations and the remarketing agent
chooses not to purchase such reset rate notes itself;
|
• |
any rating agency then rating the notes has not confirmed or upgraded its then-current rating of any class of notes, if such confirmation is required; or
|
• |
certain other conditions specified in the remarketing agreement are not satisfied.
|
• |
all holders of such class of reset rate notes will retain their notes, including in all deemed mandatory tender situations;
|
• |
the related interest rate for such class of reset rate notes will be reset to a failed remarketing rate of the SOFR Rate plus 0.75% per annum; and
|
• |
the related reset period will be set at three months.
|
• |
to facilitate the trust’s ability to pay principal and interest in the applicable currency;
|
• |
to pay additional interest at the applicable interest rate and in the applicable currency on such reset rate notes from and including the related reset date to, but excluding the second business day following the related reset date;
and
|
• |
to facilitate the exchange of all secondary market trade proceeds from a successful remarketing (or proceeds from the exercise of the call option) on the applicable reset date to the applicable currency.
|
• |
on the effective date of such currency swap agreement for the related reset date, the U.S. Dollar equivalent of all secondary market trade proceeds received from purchasers of the related class of reset rate notes using the exchange
rate established on the effective date of such currency swap agreement;
|
• |
on or before each distribution date, (1) the rate of interest on the related class of reset rate notes multiplied by the outstanding principal balance of the related class of reset rate notes denominated in the applicable currency and
(2) the currency equivalent of the U.S. Dollars such swap counterparty concurrently receives from the trust as a payment of principal allocated to the related class of reset rate notes, including, on the maturity date for the related
class of reset rate notes, if a currency swap agreement is then in effect, the remaining outstanding principal balance of the related class of reset rate notes, but only to the extent that the required U.S. Dollar equivalent amount is
received from the trust on such date, using the exchange rate established on the applicable effective date of the currency swap agreement;
|
• |
with respect to a distribution date that is also a reset date, other than for distribution dates during a reset period following a reset date upon which a failed remarketing has occurred, up to and including the reset date resulting in
a successful remarketing or an exercise of the call option, additional interest at the applicable interest rate and in the applicable currency for the related class of reset rate notes from and including the related reset date to, but
excluding, the second business day following the related reset date; and
|
• |
on the reset date corresponding to a successful remarketing or an exercise of the call option of the related class of reset rate notes, the currency equivalent of all U.S. Dollar secondary market trade proceeds or proceeds from the
exercise of the call option received as of that reset date, as applicable, using the exchange rate established on the effective date of the applicable currency swap agreement for that reset date.
|
• |
on the effective date of such currency swap agreement for the related reset date, all secondary market trade proceeds received from purchasers of the related class of reset rate notes in the applicable currency;
|
• |
on or before each distribution date, (1) an interest rate of the SOFR Rate plus or minus a spread, as determined from the bidding process described below, multiplied by that swap counterpart’s pro rata share, as applicable, of the U.S.
Dollar equivalent of the outstanding principal balance of the related class of reset rate notes, and (2) that swap counterpart’s pro rata share of all payments of principal in U.S. Dollars that are allocated to the related class of reset
rate notes; provided that, all principal payments allocated to such notes on any distribution date will be deposited into the related accumulation account and paid to each related swap counterparty on or about the next reset date
(including all amounts required to be deposited in the related accumulation account on the related reset date), but excluding all investment earnings thereon; and
|
• |
on the reset date corresponding to a successful remarketing or an exercise of the call option of the related class of reset rate notes, all U.S. Dollar secondary market trade proceeds or proceeds from the exercise of the call option,
as applicable, received (1) from the remarketing agent that the remarketing agent either received directly from the purchasers of the related class of reset rate notes, if in U.S. Dollars; (2) from the new swap counterparty or
counterparties pursuant to the related currency swap agreements for the upcoming reset period, if in a currency other than U.S. Dollars; or (3) from the holder of the call option, as applicable.
|
• |
the next succeeding related reset date resulting in a successful remarketing;
|
• |
the purchase of all outstanding notes on a reset date, following the exercise of a call option;
|
• |
the distribution date on which the outstanding principal balance of the related class of reset rate notes is reduced to zero, excluding for such purpose all amounts on deposit in the related accumulation account; or
|
• |
the maturity date of the related class of reset rate notes.
|
• |
the applicable spread as determined by the remarketing agent on the Spread Determination Date; and
|
• |
the yield to maturity on the Spread Determination Date of the applicable fixed rate pricing benchmark, selected by the remarketing agent, as having an expected weighted average life based on a scheduled maturity at the next reset date,
which would be used in accordance with customary financial practice in pricing new issues of asset-backed securities of comparable average life, provided, that the remarketing agent shall establish that fixed rate equal to the rate that,
in the reasonable opinion of the remarketing agent, will enable all of the tendered reset rate notes to be remarketed by the remarketing agent at 100% of their outstanding principal balance. However, that fixed rate of interest will in
no event be lower than the related All Hold Rate, if applicable.
|
• |
the next succeeding reset date, if the related class of reset rate notes is then denominated in U.S. Dollars, or the next succeeding reset date resulting in a successful remarketing, if that class is then in foreign exchange mode;
|
• |
the related reset date for which the call option is exercised;
|
• |
the distribution date on which the outstanding principal balance of the related class of reset rate notes is reduced to zero (including as the result of the optional purchase of the remaining trust student loans by the servicer or an
auction of the trust student loans by the indenture trustee); or
|
• |
the maturity date of the related class of reset rate notes.
|
• |
an event of default under the indenture relating to the payment of principal on any class at its maturity date or to the payment of interest on any class of notes which has resulted in an acceleration of the maturity of the notes,
|
• |
an event of default under the indenture relating to an insolvency event or a bankruptcy with respect to the trust which has resulted in an acceleration of the maturity of the notes, or
|
• |
a liquidation of the trust assets following any event of default under the indenture,
|
A: |
to the applicable noteholders of a class of reset rate notes if then denominated in U.S. Dollars and structured not to receive a payment of principal until the end of their related reset period, the amount, if any, on deposit in the
related accumulation account (excluding any investment earnings thereon) in reduction of the outstanding amount of such class of reset rate notes until they are paid in full; and/or
|
B: |
to the related currency Swap Counterparty if a class of reset rate notes is then in foreign exchange mode and structured not to receive a payment of principal until the end of their related reset period, the amount, if any, on deposit
in the related accumulation account for the reset rate notes (excluding any investment earnings thereon) to be used in reduction of the outstanding amount of such class of reset rate notes until they are paid in full;
|
A: |
to the class A noteholders (other than the noteholders of a class of reset rate notes if one or more swap agreements with respect to interest payments to be made to such noteholders is then in effect), for amounts due and unpaid on the
class A Notes for interest at the applicable rate of interest due such class, ratably, without preference or priority of any kind, according to the amounts due and payable on the class A notes for such interest;
|
B: |
if one or more swap agreement is then in effect for a class of reset rate notes with respect to interest payments to be made to the related reset rate noteholders, to each Swap Counterparty, the amount of any swap interest payments due
and payable by the trust (other than as paid to each such Swap Counterparty under clause FIRST); and
|
C: |
if any swap agreement with respect to a class of reset rate notes has been terminated, to the related Swap Counterparty, the amount of any swap termination payments due to such Swap Counterparty due to a swap termination event
resulting from a payment default by the trust or the insolvency of the trust; provided, that if any amounts allocable to the class A notes are not needed to pay the Class A Noteholders’ Interest Distribution Amount as of such distribution
date, such amounts will be applied to pay the portion, if any, of any swap termination payment referred to in this clause FIFTH remaining unpaid;
|
A: |
if one or more classes of reset rate notes are in foreign exchange mode, pro rata (1) to the class A noteholders, ratably, an amount sufficient to reduce the respective principal balance of those class A notes (other than any class or
classes of reset rate notes then in foreign exchange mode) to zero, and (2) to the applicable currency Swap Counterparties an amount sufficient to reduce the U.S. Dollar Notional Principal Balance of such class or classes of reset rate
notes to zero; or
|
B: |
if all classes of the reset rate notes are then denominated in U.S. Dollars, pro rata to the class A noteholders, ratably, an amount sufficient to reduce the respective principal balances of all class A notes to zero;
|
• |
“Benchmark” means, initially, Compounded SOFR; provided, that if the administrator determines prior to the relevant Reference Time that a Benchmark Transition Event and its related Benchmark
Replacement Date have occurred with respect to SOFR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement.
|
• |
“Benchmark Replacement” means, for any Interest Determination Date after the administrator has determined that a Benchmark Transition Event and its related Benchmark Replacement Date have
occurred, the first alternative set forth in the order below that can be determined by the administrator, without obtaining the consent of any noteholders, as of the Benchmark Replacement Date;
|
• |
“Benchmark Replacement Adjustment” means, for any Interest Determination Date after the administrator has determined that a Benchmark Transition Event and its related Benchmark Replacement
Date have occurred, the first alternative set forth in the order below that can be determined by the administrator as of the Benchmark Replacement Date:
|
• |
“Benchmark Replacement Conforming Changes” means, in connection with any determination and calculation of the Benchmark Replacement, any technical, administrative or operational changes
(including changes to the accrual period, timing and frequency of determining rates and making payments of interest, rounding of amounts or tenors and other administrative matters) that the administrator decides in its reasonable
discretion may be appropriate to reflect the adoption of such Benchmark Replacement in a manner substantially consistent with market practice (or, if the administrator decides that adoption of any portion of such market practice is
not administratively feasible or if the administrator determines that no market practice for use of the Benchmark Replacement exists, in such other manner as the administrator determines in its reasonable discretion is reasonably
necessary).
|
• |
“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark (including the daily published component used in the calculation
thereof):
|
• |
“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark (including the daily published component used in the
calculation thereof):
|
• |
“Compounded SOFR” with respect to any U.S. Government Securities Business Day, means:
|
• |
“Corresponding Tenor” means, with respect to a Benchmark Replacement, a tenor (including overnight) having approximately the same length (disregarding any business day adjustment) as the
applicable tenor for the then-current Benchmark.
|
• |
“FRBNY” means the Federal Reserve Bank of New York.
|
• |
“FRBNY’s Website” means the website of the FRBNY, currently at https://apps.newyorkfed.org/markets/autorates/sofr-avg-ind or at such other page as may replace such page on the FRBNY’s
website.
|
• |
“Interest Determination Date” means, for each accrual period, the second Business Day before the beginning of that accrual period.
|
• |
“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to
time, or any successor definitional booklet for interest rate derivatives published from time to time.
|
• |
“ISDA Fallback Adjustment” means the spread adjustment (which may be a positive or negative value or zero) that would apply for derivatives transactions referencing the ISDA Definitions to be
determined upon the occurrence of an index cessation event with respect to the Benchmark.
|
• |
“ISDA Fallback Rate” means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective upon the occurrence of an index cessation date with respect
to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment.
|
• |
“Relevant Governmental Body” means the Federal Reserve Board and/or the FRBNY, or a committee officially endorsed or convened by the Federal Reserve Board and/or the FRBNY or any successor
thereto.
|
• |
“SOFR” means, with respect to any date of determination, the secured overnight financing rate for the applicable tenor published on such date by the Federal Reserve Bank of New York, as the
administrator of the Benchmark (or any successor administrator of the benchmark rate) on the website of the Federal Reserve Bank of New York, or any successor source.
|
• |
“SOFR Adjustment Conforming Changes” means, with respect to any SOFR Rate, any technical, administrative or operational changes (including changes to the accrual period, timing and frequency
of determining rates and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the administrator decides, from time to time, may be appropriate to adjust such SOFR rate in a manner
substantially consistent with or conforming to market practice (or, if the administrator decides that adoption of any portion of such market practice is not administratively feasible or if the administrator determines that no market
practice exists, in such other manner as the administrator determines is reasonably necessary).
|
• |
“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.
|
• |
“U.S. Government Securities Business Day” means any day except for a Saturday, a Sunday or a day on which the Securities Industry and Financial Markets Association recommends that the fixed
income departments of its members be closed for the entire day for purposes of trading in U.S. government securities.
|
• |
pay to noteholders the interest payable on the related distribution date; and
|
• |
reduce the outstanding principal amount of each class of notes then outstanding on the related distribution date to zero, taking into account all amounts then on deposit in any accumulation account.
|
• |
is then structured not to receive a payment of principal until the end of the related reset period, the outstanding principal balance of that class will be deemed to have been reduced by any amounts on deposit, exclusive of any
investment earnings, in the related accumulation account; and/or
|
• |
is then denominated in a non-U.S. Dollar currency, the U.S. Dollar Notional Principal Balance of that class will be determined based upon the exchange rate provided for in the related currency swap agreement or agreements.
|
• |
the minimum purchase amount described under “—Optional Purchase” above (plus any amounts owed to the servicer as carryover servicing fees); or
|
• |
the fair market value of the trust student loans as of the end of the related collection period.
|
• |
to correct or amplify the description of any property at any time subject to the lien of the indenture, or better to assure, convey and confirm unto the indenture trustee any property subject or required to be subjected to the lien
of the indenture, or to subject to the lien of the indenture any additional property;
|
• |
to evidence the succession of another person to the trust, and the assumption by any such successor of the covenants of the trust in the indenture and in the notes;
|
• |
to add to the covenants of the trust for the benefit of the noteholders and the Swap Counterparties, as applicable, or to surrender any right or power herein conferred upon the trust;
|
• |
to convey, transfer, assign, mortgage or pledge any additional property to the indenture trustee;
|
• |
to cure any ambiguity, to correct or supplement any provision in the indenture which may be inconsistent with any other provision of the indenture; provided that such action shall not materially adversely affect the interests of
the noteholders or any Swap Counterparty; or
|
• |
to modify, eliminate or add to the provisions of the indenture to such extent as shall be necessary to effect the qualification of this indenture under the Trust Indenture Act or under any similar federal statute later enacted and
to add to the indenture such other provisions as may be expressly required by the Trust Indenture Act.
|
• |
change the date of payment of any installment of principal of or interest on any note, or reduce the principal amount thereof, the interest rate thereon or the redemption price with respect thereto, change the provisions of the
indenture relating to the application of collections on, or the proceeds of the sale of, the trust estate to payment of principal of or interest on the notes, or change any place of payment where, or the coin or currency in which, any
note or the interest thereon is payable or impair the right to institute suit for the enforcement of the provisions of the indenture requiring the application of funds available therefor to the payment of any such amount due on the
notes on or after the respective due dates thereof (or, in the case of redemption, on or after the redemption date);
|
• |
reduce the percentage of the outstanding amount of the notes, the consent of the noteholders of which is required for any such supplemental indenture, or the consent of the noteholders of which is required for any waiver of
compliance with certain provisions of the indenture or certain defaults thereunder and their consequences provided for in the indenture;
|
• |
modify or alter the provisions of the proviso to the definition of the term “Outstanding”;
|
• |
reduce the percentage of outstanding notes whose holders must consent to any supplemental indenture;
|
• |
reduce the percentage of outstanding notes whose holders must consent to a sale or liquidation of the trust student loans if the proceeds of the sale would be insufficient to pay the principal amount and accrued interest on the
notes;
|
• |
modify the provisions of the indenture which specify the applicable percentages of principal amount of notes necessary to take specified actions except to increase these percentages or to specify additional provisions;
|
• |
modify any of the provisions of the indenture to affect the calculation of interest or principal due on any note on any distribution date or to affect the rights of the noteholders to the benefit of any provisions for the mandatory
redemption of the notes; or
|
• |
permit the creation of any lien ranking prior or equal to the lien of the indenture on any of the collateral for that series or, except as otherwise permitted or contemplated in that indenture, terminate the lien of the indenture
on any collateral or deprive the holder of any note of the security afforded by that lien.
|
• |
a default for five Business Days or more in the payment of any interest on any note after it is due and payable;
|
• |
a default in the payment of the principal of any note at maturity;
|
• |
a default in the performance of any covenant or agreement of the trust in the indenture, or a material breach of any representation or warranty made by the trust in the indenture or in any certificate, if the default or breach has
a material adverse effect on the holders of the notes and is not cured within 30 days after notice by the indenture trustee or by holders of at least 25% in principal amount of the outstanding notes; or
|
• |
the occurrence of an insolvency event involving the trust.
|
• |
exercise remedies as a secured party against the trust student loans and other assets of the trust that are subject to the lien of the indenture;
|
• |
sell the trust student loans and other assets of the trust; or
|
• |
elect to have the eligible lender trustee, maintain ownership of the trust student loans and continue to apply collections on them as if there had been no declaration of acceleration.
|
• |
the holders of all the outstanding notes consent to the sale;
|
• |
the proceeds of the sale are sufficient to pay in full the principal and accrued interest on the outstanding notes, at the date of the sale; or
|
• |
the indenture trustee determines that the collections would not be sufficient on an ongoing basis to make all payments on the notes as the payments would have become due if the notes had not been declared due and payable, and the
indenture trustee obtains the consent of the holders of 66 2/3% of the outstanding notes.
|
• |
the holder previously has given to the indenture trustee written notice of a continuing event of default;
|
• |
the holders of not less than 25% of the outstanding notes, have requested in writing that the indenture trustee institute a proceeding in its own name as indenture trustee;
|
• |
the holder or holders have offered the indenture trustee reasonable indemnity;
|
• |
the indenture trustee has for 60 days after receipt of notice failed to institute the proceeding; and
|
• |
no direction inconsistent with the written request has been given to the indenture trustee during the 60-day period by the holders of a majority of the outstanding notes.
|
• |
the entity formed by or surviving the consolidation or merger is organized under the laws of the United States, any state or the District of Columbia;
|
• |
the surviving entity expressly assumes the trust’s obligation to make due and punctual payments on the notes and the performance or observance of every agreement and covenant of the trust under the indenture;
|
• |
no default will occur and be continuing immediately after the merger or consolidation;
|
• |
the trust has been advised that the ratings then applicable to the notes would not be reduced or withdrawn as a result of the merger or consolidation;
|
• |
any action that is necessary to maintain the lien and security interest created by the indenture shall have been taken; and
|
• |
the trust has received opinions of federal and Delaware tax counsel that the consolidation or merger would have no material adverse U.S. federal or Delaware state tax consequences to the trust or to any holder of the notes.
|
• |
except as expressly permitted by the indenture, the transfer and servicing agreements or other related documents, sell, transfer, exchange or otherwise dispose of any of the assets of that trust;
|
• |
claim any credit on or make any deduction from the principal and interest payable on notes of the series, other than amounts withheld under the Internal Revenue Code or applicable state law, or assert any claim against any present
or former holder of notes because of the payment of taxes levied or assessed upon the trust;
|
• |
except as contemplated by the indenture and the related documents, dissolve or liquidate in whole or in part;
|
• |
permit the validity or effectiveness of the indenture to be impaired or permit any person to be released from any covenants or obligations under the indenture, except as expressly permitted by the indenture; or
|
• |
permit any lien, charge or other encumbrance to be created on the assets of the trust, except as expressly permitted by the indenture and the related documents.
|
• |
A financing statement or statements covering the student loans naming each related seller, as seller/debtor, was filed under the UCC to protect the interest of the depositor in the event that the transfer by such seller is deemed
to be an assignment of collateral as security; and
|
• |
A financing statement or statements covering the trust student loans naming the depositor, as seller/debtor, was also filed under the UCC to protect the interest of the eligible lender trustee, in the event that the transfer by the
depositor is deemed to be an assignment of collateral as security.
|
• |
a citizen or individual resident of the United States;
|
• |
a corporation (including an entity treated as such) organized in or under the laws of the United States, any state thereof or the District of Columbia;
|
• |
an estate the income of which is includible in gross income for U.S. federal income tax purposes, regardless of its source; or
|
• |
a trust whose administration is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust.
|
• |
is not actually or constructively a “10 percent shareholder” of Navient, Navient Credit Finance Corporation, the depositor or the trust, or a “controlled foreign corporation” with respect to which Navient, Navient Credit Finance
Corporation, the depositor or the trust is a “related person” within the meaning of the Code, and
|
• |
provides an appropriate statement, signed under penalties of perjury, certifying that the holder is a foreign person and providing that foreign person’s name and address. For beneficial owners that are individuals or entities
treated as corporations, this certification may be made on Form W-8BEN or Form W-8BEN-E. If the information provided in this statement changes, the foreign person must report that change within 30 days of such change. The statement
generally must be provided in the year a payment occurs or in any of the three preceding years.
|
• |
the gain is not effectively connected with the conduct of a trade or business in the United States by the foreign person, and
|
• |
in the case of an individual foreign person, the foreign person is not present in the United States for 183 days or more in the taxable year and certain other requirements are met.
|
• |
employee benefit plans as defined in Section 3(3) of ERISA that are subject to Title I of ERISA;
|
• |
certain other retirement plans and arrangements described in Section 4975 of the Code, including:
|
• |
collective investment funds and separate accounts and, as applicable, insurance company general accounts in which those plans, accounts or arrangements are invested that are subject to the fiduciary responsibility provisions of
ERISA and Section 4975 of the Code;
|
• |
any other entity whose assets are deemed to be “plan assets” as a result of any of the above plans, arrangements, funds or accounts investing in such entity; and
|
• |
persons who are fiduciaries with respect to plans in connection with the investment of plan assets.
|
• |
Prohibited Transaction Class Exemption (“PTCE”) 96‑23, which exempts certain transactions effected on behalf of a Plan by an “in‑house asset manager”;
|
• |
PTCE 90‑1, which exempts certain transactions between insurance company separate accounts and Parties in Interest;
|
• |
PTCE 91‑38, which exempts certain transactions between bank collective investment funds and Parties in Interest;
|
• |
PTCE 95‑60, which exempts certain transactions between insurance company general accounts and Parties in Interest; or
|
• |
PTCE 84‑14, which exempts certain transactions effected on behalf of a Plan by a “qualified professional asset manager.”
|
• |
Reports on Form 8-K (Current Report), following the occurrence of events specified in Form 8-K requiring disclosure, which are required to be filed within the time-frame specified in Form 8-K related to the type of event;
|
• |
Reports on Form 10-D (Asset-Backed Issuer Distribution Report), containing the distribution and pool performance information required on Form 10-D, which are required to be filed 15 days following the distribution date; and
|
• |
Report on Form 10-K (Annual Report), containing the items specified in Form 10-K with respect to a fiscal year and the items required pursuant to Items 1122 and 1123 of Regulation AB under the Securities Act.
|
(a) |
it has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any reset rate notes to any EU retail investor in the EEA. For the purposes of this provision:
|
(i) |
the expression “EU retail investor” means a person who is one (or more) of the following: (A) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or (B) a customer within the
meaning of Directive (EU) 2016/97 (as amended), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (C) not a qualified investor as defined in Regulation (EU)
2017/1129 (as amended, the “Prospectus Regulation”); and
|
(ii) |
the expression “offer” includes the communication in any form and by any means of sufficient information on the terms of the offer and the notes to be offered so as to enable an investor to decide to purchase or subscribe the
notes;
|
(b) |
it has not offered, sold or otherwise made available and will not offer, sell or otherwise make available any notes to any UK retail investor in the United Kingdom. For the purposes of this provision:
|
(i) |
the expression “UK retail investor” means a person who is one (or more) of the following: (i) a retail client, as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of the domestic law of the United
Kingdom by virtue of the European Union (Withdrawal) Act 2018 (as amended, the “EUWA”); or (ii) a customer within the meaning of the provisions of the Financial Services and Markets Act 2000, as amended (the “FSMA”) and any rules or
regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of the
domestic law of the United Kingdom by virtue of the EUWA; or (iii) not a qualified investor as defined in Article 2 of Regulation (EU) 2017/1129 as it forms part of the domestic law of the United Kingdom by virtue of the EUWA (the “UK
Prospectus Regulation”); and
|
(ii) |
the expression an “offer” includes the communication in any form and by any means of sufficient information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe for
the Notes.
|
(c) |
it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services
and Markets Act 2000 (“FSMA”)) received by it in connection with the issue or sale of the reset rate notes in circumstances in which Section 21 of the FSMA does not apply to the issuing entity or the trust;
|
(d) |
it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the reset rate notes in, from or otherwise involving the United Kingdom.
|
• |
all collections on the trust student loans, including any guarantee payments received on the trust student loans, but net of:
|
(1) |
any collections in respect of principal on the trust student loans applied by the trust to repurchase guaranteed loans from the guarantors under the guarantee agreements, and
|
(2) |
amounts required by the Higher Education Act to be paid to the Department of Education or to be repaid to borrowers, whether or not in the form of a principal reduction of the applicable trust student loan, on the trust student
loans for that collection period, including consolidation loan rebate fees;
|
• |
any interest subsidy payments and special allowance payments received by the servicer or the eligible lender trustee with respect to the trust student loans during that collection period;
|
• |
all proceeds of the liquidation of defaulted trust student loans which were liquidated during that collection period in accordance with the servicer’s customary servicing procedures, net of expenses incurred by the servicer related
to their liquidation and any amounts required by law to be remitted to the borrower on the liquidated student loans, and all recoveries on liquidated student loans which were written off in prior collection periods or during that
collection period;
|
• |
the aggregate purchase amounts received during that collection period for those trust student loans repurchased by the depositor or purchased by the servicer or for trust student loans sold to another eligible lender pursuant to
the servicing agreement;
|
• |
the aggregate purchase amounts received during that collection period for those trust student loans purchased by the sellers;
|
• |
the aggregate amounts, if any, received from the sellers, the depositor or the servicer as the case may be, as reimbursement of non-guaranteed interest amounts, or lost interest subsidy payments and special allowance payments, on
the trust student loans pursuant to the sale agreement or the servicing agreement;
|
• |
amounts received by the trust pursuant to the servicing agreement during that collection period as to yield or principal adjustments;
|
• |
any interest remitted by the administrator to the collection account prior to that distribution date or monthly servicing date;
|
• |
investment earnings for that distribution date earned on amounts on deposit in each Trust Account (other than any accumulation account and any currency account);
|
• |
investment earnings actually received by the trust for that distribution date earned on amounts on deposit in any accumulation account;
|
• |
amounts transferred from the remarketing fee account in excess of the Reset Period Target Amount for that distribution date;
|
• |
amounts transferred from any investment premium purchase account in excess of the amount required to be on deposit therein pursuant to the formula set forth in the administration agreement;
|
• |
all amounts on deposit in any investment reserve account not transferred to the accumulation account to offset realized losses on eligible investments as of that distribution date;
|
• |
all amounts on deposit in any supplemental interest account;
|
• |
amounts transferred from the reserve account in excess of the Specified Reserve Account Balance as of that distribution date;
|
• |
all amounts received by the trust from any potential future cap counterparty, or otherwise under any potential future interest rate cap agreement, for deposit into the collection account for that distribution date; and
|
• |
all amounts received by the trust from any Swap Counterparty for deposit into the collection account, but only to the extent paid in U.S. Dollars, for that distribution date;
|
• |
if such class did not have at least one related swap agreement in effect during the previous reset period, the floating rate applicable for the initial reset period during which the Failed Remarketing Rate was not in effect; or
|
• |
if such class had one or more swap agreements in effect during the previous reset period, the weighted average of the floating rates of interest that were due to the related Swap Counterparties from the trust during the previous
reset period.
|
• |
the Class A Noteholders’ Interest Distribution Amount on the preceding distribution date, over
|
• |
the amount of interest actually distributed to the class A noteholders on that preceding distribution date,
|
• |
the Class A Noteholders’ Principal Distribution Amount on that distribution date, over
|
• |
the amount of principal actually distributed or allocated to the class A noteholders or deposited into the accumulation account on that distribution date.
|
• |
the amount of interest accrued at the class A note interest rates for the related accrual period on the aggregate outstanding principal balances of all classes of class A notes on the immediately preceding distribution date, after
giving effect to all principal distributions to class A noteholders on that preceding distribution date; and
|
• |
the Class A Note Interest Shortfall for that distribution date.
|
• |
the Class B Noteholders’ Interest Distribution Amount on the preceding distribution date, over
|
• |
the amount of interest actually distributed to the class B noteholders on that preceding distribution date,
|
• |
the Class B Noteholders’ Principal Distribution Amount on that distribution date, over
|
• |
the amount of principal actually distributed to the class B noteholders on that distribution date.
|
• |
the amount of interest accrued at the class B note rate for the related accrual period on the outstanding principal balance of the class B notes on the immediately preceding distribution date, after giving effect to all principal
distributions to class B noteholders on that preceding distribution date, and
|
• |
the Class B Note Interest Shortfall for that distribution date.
|
• |
prior to the Stepdown Date or with respect to any distribution date on which a Trigger Event is in effect, zero; and
|
• |
on and after the Stepdown Date and provided that no Trigger Event is in effect, a fraction expressed as a percentage, the numerator of which is the aggregate principal balance of the class B notes immediately prior to that
distribution date and the denominator of which is the aggregate principal balance of all outstanding notes, less all amounts (other than investment earnings) on deposit in the accumulation account, immediately prior to that
distribution date.
|
• |
the remarketing agent, in consultation with the administrator, cannot establish one or more of the terms required to be set on the Remarketing Terms Determination Date,
|
• |
the remarketing agent is unable to establish the related Spread or fixed rate on the Spread Determination Date,
|
• |
the remarketing agent is unable to remarket some or all of the tendered reset rate notes at the Spread or fixed rate established on the Spread Determination Date, or committed purchasers default on their purchase obligations, and
the remarketing agent, in its sole discretion, elects not to purchase the applicable reset rate notes themselves,
|
• |
the remarketing agent, in consultation with the administrator, is unable to obtain one or more swap agreements meeting the required criteria, if applicable,
|
• |
certain conditions specified in the remarketing agreement are not satisfied, or
|
• |
any applicable Rating Agency Condition has not been satisfied.
|
• |
all payments received by the trust through that date from borrowers, the guaranty agencies and the Department of Education;
|
• |
all amounts received by the trust through that date from repurchases of the trust student loans by any of the sellers, the depositor or the servicer;
|
• |
all liquidation proceeds and Realized Losses on the trust student loans liquidated through that date;
|
• |
the amount of any adjustments to balances of the trust student loans that the servicer makes under the servicing agreement through that date; and
|
• |
the amount by which guarantor reimbursements of principal on defaulted trust student loans through that date are reduced from 100% to 98%, or other applicable percentage, as required by the risk sharing provisions of the Higher
Education Act.
|
• |
as to the initial distribution date, the amount by which the aggregate outstanding principal amount of the notes exceeds the Adjusted Pool Balance for that distribution date, and
|
• |
as to each subsequent distribution date, the amount by which the Adjusted Pool Balance for the preceding distribution date exceeds the Adjusted Pool Balance for that distribution date.
|
(a) |
0.25% of the Pool Balance as of the close of business on the last day of the related collection period; and
|
(b) |
$4,524,559;
|
• |
the product of:
|
(1) |
the difference between (a) the weighted average of the SOFR Rate (as determined on the SOFR Adjustment Date related to that distribution date) that will be payable by the trust to any related Swap Counterparties on the next
distribution date and (b) an assumed rate of investment earnings that satisfies the Rating Agency Condition,
|
(2) |
the amount on deposit in the related accumulation account immediately after that distribution date, and
|
(3) |
the actual number of days from that distribution date to the applicable next reset date, divided by 360; and
|
• |
an amount that satisfies the Rating Agency Condition.
|
• |
was a consolidation loan 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 fully disbursed;
|
• |
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.
|
COMPOSITION OF THE TRUST STUDENT LOANS AS OF
THE STATISTICAL DISCLOSURE DATE
|
||||
Aggregate Outstanding Principal Balance
|
$
|
518,255,846
|
||
Aggregate Outstanding Principal Balance – Treasury Bill
|
$
|
19,837,061
|
||
Percentage of Aggregate Outstanding Principal Balance – Treasury Bill
|
3.83
|
%
|
||
Aggregate Outstanding Principal Balance – One-Month LIBOR(1)
|
$
|
496,891,704
|
||
Percentage of Aggregate Outstanding Principal Balance – One-Month TATLIBOR
|
95.88
|
%
|
||
Aggregate Outstanding Principal Balance – Treasury Bill Other
|
$
|
1,527,080
|
||
Percentage of Aggregate Outstanding Principal Balance – Treasury Bill Other
|
0.29
|
%
|
||
Number of Borrowers
|
16,479
|
|||
Average Outstanding Principal Balance Per Borrower
|
$
|
31,449
|
||
Number of Loans
|
28,927
|
|||
Average Outstanding Principal Balance Per Loan – Treasury Bill
|
$
|
25,270
|
||
Average Outstanding Principal Balance Per Loan – One-Month LIBOR(1)
|
$
|
17,679
|
||
Average Outstanding Principal Balance Per Loan – Treasury Bill Other
|
$
|
43,631
|
||
Weighted Average Remaining Term to Scheduled Maturity
|
180 months
|
|||
Weighted Average Annual Interest Rate
|
4.94
|
%
|
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%
|
4,420
|
$
|
65,417,629
|
12.6
|
%
|
|||||||
3.01% to 3.50%
|
4,840
|
65,657,977
|
12.7
|
|||||||||
3.51% to 4.00%
|
3,941
|
61,178,210
|
11.8
|
|||||||||
4.01% to 4.50%
|
3,296
|
54,136,746
|
10.4
|
|||||||||
4.51% to 5.00%
|
3,419
|
61,495,720
|
11.9
|
|||||||||
5.01% to 5.50%
|
3,549
|
52,239,396
|
10.1
|
|||||||||
5.51% to 6.00%
|
1,147
|
28,697,693
|
5.5
|
|||||||||
6.01% to 6.50%
|
1,691
|
39,938,433
|
7.7
|
|||||||||
6.51% to 7.00%
|
836
|
23,899,802
|
4.6
|
|||||||||
7.01% to 7.50%
|
215
|
10,361,647
|
2.0
|
|||||||||
7.51% to 8.00%
|
689
|
19,523,926
|
3.8
|
|||||||||
8.01% to 8.50%
|
693
|
24,986,032
|
4.8
|
|||||||||
Equal to or greater than 8.51%
|
191 | 10,722,634 |
2.1
|
|||||||||
Total
|
28,927 |
$
|
518,255,846
|
100.0 | % |
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
|
3,356
|
$ |
8,307,203
|
1.6
|
% |
||
$5,000.00-$ 9,999.99
|
2,483
|
18,199,054
|
3.5
|
||||
$10,000.00-$14,999.99
|
1,878
|
23,357,667
|
4.5
|
||||
$15,000.00-$19,999.99
|
1,482
|
25,797,238
|
5.0
|
||||
$20,000.00-$24,999.99
|
1,121
|
25,151,945
|
4.9
|
||||
$25,000.00-$29,999.99
|
941
|
25,866,231
|
5.0
|
||||
$30,000.00-$34,999.99
|
768
|
24,843,202
|
4.8
|
||||
$35,000.00-$39,999.99
|
648
|
24,264,465
|
4.7
|
||||
$40,000.00-$44,999.99
|
503
|
21,339,044
|
4.1
|
||||
$45,000.00-$49,999.99
|
437
|
20,687,064
|
4.0
|
||||
$50,000.00-$54,999.99
|
328
|
17,186,887
|
3.3
|
||||
$55,000.00-$59,999.99
|
312
|
17,947,858
|
3.5
|
||||
$60,000.00-$64,999.99
|
241
|
15,039,496
|
2.9
|
||||
$65,000.00-$69,999.99
|
223
|
15,048,060
|
2.9
|
||||
$70,000.00-$74,999.99
|
160
|
11,604,713
|
2.2
|
||||
$75,000.00-$79,999.99
|
154
|
11,919,875
|
2.3
|
||||
$80,000.00-$84,999.99
|
156
|
12,850,118
|
2.5
|
||||
$85,000.00-$89,999.99
|
112
|
9,793,899
|
1.9
|
||||
$90,000.00-$94,999.99
|
100
|
9,242,357
|
1.8
|
||||
$95,000.00-$99,999.99
|
99
|
9,657,487
|
1.9
|
||||
$100,000.00 and above
|
977
|
170,151,982
|
32.8
|
||||
Total
|
16,479
|
$ |
518,255,846
|
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
|
27,163
|
$
|
477,149,891
|
92.1
|
%
|
|||||||
31-60 days
|
496
|
12,323,035
|
2.4
|
|||||||||
61-90 days
|
365
|
8,450,321
|
1.6
|
|||||||||
91-120 days
|
241
|
5,317,684
|
1.0
|
|||||||||
121-150 days
|
150
|
3,572,057
|
0.7
|
|||||||||
151-180 days
|
103
|
2,742,315
|
0.5
|
|||||||||
181-210 days
|
89
|
2,149,977
|
0.4
|
|||||||||
Greater than 210 days
|
320
|
6,550,567
|
1.3
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
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
|
201
|
$
|
44,507
|
*
|
||||||||
4 to 12
|
806
|
601,781
|
0.1
|
%
|
||||||||
13 to 24
|
1,563
|
2,401,190
|
0.5
|
|||||||||
25 to 36
|
2,211
|
6,095,152
|
1.2
|
|||||||||
37 to 48
|
1,752
|
7,435,962
|
1.4
|
|||||||||
49 to 60
|
1,518
|
8,422,396
|
1.6
|
|||||||||
61 to 72
|
1,485
|
9,666,168
|
1.9
|
|||||||||
73 to 84
|
1,403
|
11,110,050
|
2.1
|
|||||||||
85 to 96
|
1,805
|
17,362,185
|
3.4
|
|||||||||
97 to 108
|
1,514
|
19,015,114
|
3.7
|
|||||||||
109 to 120
|
1,416
|
20,813,255
|
4.0
|
|||||||||
121 to 132
|
1,839
|
34,818,839
|
6.7
|
|||||||||
133 to 144
|
2,016
|
41,243,705
|
8.0
|
|||||||||
145 to 156
|
2,267
|
53,130,507
|
10.3
|
|||||||||
157 to 168
|
1,295
|
34,512,213
|
6.7
|
|||||||||
169 to 180
|
1,069
|
32,720,441
|
6.3
|
|||||||||
181 to 192
|
866
|
29,386,364
|
5.7
|
|||||||||
193 to 204
|
689
|
24,284,476
|
4.7
|
|||||||||
205 to 216
|
624
|
21,895,729
|
4.2
|
|||||||||
217 to 228
|
436
|
18,998,230
|
3.7
|
|||||||||
229 to 240
|
425
|
18,357,863
|
3.5
|
|||||||||
241 to 252
|
288
|
13,295,396
|
2.6
|
|||||||||
253 to 264
|
168
|
7,414,366
|
1.4
|
|||||||||
265 to 276
|
184
|
8,117,140
|
1.6
|
|||||||||
277 to 288
|
136
|
6,618,586
|
1.3
|
|||||||||
289 to 300
|
294
|
19,010,834
|
3.7
|
|||||||||
301 to 312
|
391
|
28,546,024
|
5.5
|
|||||||||
313 to 324
|
66
|
4,188,584
|
0.8
|
|||||||||
325 to 336
|
33
|
2,054,905
|
0.4
|
|||||||||
337 to 348
|
40
|
3,050,829
|
0.6
|
|||||||||
349 to 360
|
67
|
7,918,135
|
1.5
|
|||||||||
361 and above
|
60
|
5,724,920
|
1.1
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
*
|
Represents a percentage greater than 0% but less than 0.05%.
|
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
|
765
|
$
|
15,026,034
|
2.9
|
%
|
|||||||
Forbearance*
|
2,513
|
73,136,574
|
14.1
|
|||||||||
Repayment
|
||||||||||||
First year in repayment
|
349
|
16,382,417
|
3.2
|
|||||||||
Second year in repayment
|
296
|
14,465,154
|
2.8
|
|||||||||
Third year in repayment
|
342
|
13,583,001
|
2.6
|
|||||||||
More than 3 years in repayment
|
24,662
|
385,662,665
|
74.4
|
|||||||||
|
||||||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
(1) |
Of the trust student loans in forbearance status, approximately 148 loans with an aggregate outstanding principal balance of $4,640,387,
representing 0.90% of the pool by principal, are in the Coronavirus Disaster Forbearance Program.
|
• |
may have temporarily ceased repaying the loan through a deferment or a forbearance period (this category includes the Coronavirus Disaster Forbearance Program); or
|
• |
may be currently required to repay the loan – repayment.
|
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
|
17.6
|
-
|
193.7
|
|||||||||
Forbearance
|
-
|
14.3
|
213.7
|
|||||||||
Repayment
|
-
|
-
|
170.3
|
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
|
334
|
$
|
6,404,264
|
1.2
|
% | |||||||
Alaska
|
45
|
600,151
|
0.1
|
|||||||||
Arizona
|
691
|
11,904,260
|
2.3
|
|||||||||
Arkansas
|
146
|
2,827,619
|
0.5
|
|||||||||
California
|
2,217
|
39,381,516
|
7.6
|
|||||||||
Colorado
|
520
|
10,019,182
|
1.9
|
|||||||||
Connecticut
|
482
|
7,345,628
|
1.4
|
|||||||||
Delaware
|
109
|
1,929,589
|
0.4
|
|||||||||
District of Columbia
|
101
|
2,266,526
|
0.4
|
|||||||||
Florida
|
1,851
|
36,384,768
|
7.0
|
|||||||||
Georgia
|
1,172
|
25,402,653
|
4.9
|
|||||||||
Hawaii
|
81
|
1,144,873
|
0.2
|
|||||||||
Idaho
|
108
|
1,830,018
|
0.4
|
|||||||||
Illinois
|
1,308
|
22,482,200
|
4.3
|
|||||||||
Indiana
|
709
|
12,685,909
|
2.4
|
|||||||||
Iowa
|
221
|
3,563,424
|
0.7
|
|||||||||
Kansas
|
264
|
4,215,173
|
0.8
|
|||||||||
Kentucky
|
240
|
3,950,846
|
0.8
|
|||||||||
Louisiana
|
426
|
8,376,238
|
1.6
|
|||||||||
Maine
|
158
|
2,752,173
|
0.5
|
|||||||||
Maryland
|
757
|
15,384,509
|
3.0
|
|||||||||
Massachusetts
|
853
|
13,225,039
|
2.6
|
|||||||||
Michigan
|
924
|
16,473,979
|
3.2
|
|||||||||
Minnesota
|
513
|
7,055,422
|
1.4
|
|||||||||
Mississippi
|
196
|
4,453,625
|
0.9
|
|||||||||
Missouri
|
501
|
8,584,587
|
1.7
|
|||||||||
Montana
|
59
|
904,771
|
0.2
|
|||||||||
Nebraska
|
86
|
1,068,210
|
0.2
|
|||||||||
Nevada
|
196
|
5,017,941
|
1.0
|
|||||||||
New Hampshire
|
161
|
2,169,208
|
0.4
|
|||||||||
New Jersey
|
1,254
|
23,280,906
|
4.5
|
|||||||||
New Mexico
|
119
|
3,301,750
|
0.6
|
|||||||||
New York
|
1,915
|
34,098,353
|
6.6
|
|||||||||
North Carolina
|
851
|
15,256,942
|
2.9
|
|||||||||
North Dakota
|
65
|
1,097,689
|
0.2
|
|||||||||
Ohio
|
1,391
|
24,482,747
|
4.7
|
|||||||||
Oklahoma
|
312
|
5,743,207
|
1.1
|
|||||||||
Oregon
|
432
|
7,759,631
|
1.5
|
|||||||||
Pennsylvania
|
1,420
|
22,779,867
|
4.4
|
|||||||||
Rhode Island
|
96
|
1,492,547
|
0.3
|
|||||||||
South Carolina
|
355
|
7,584,257
|
1.5
|
|||||||||
South Dakota
|
55
|
519,476
|
0.1
|
|||||||||
Tennessee
|
425
|
7,400,180
|
1.4
|
|||||||||
Texas
|
2,101
|
35,656,430
|
6.9
|
|||||||||
Utah
|
128
|
2,780,312
|
0.5
|
|||||||||
Vermont
|
78
|
1,309,859
|
0.3
|
|||||||||
Virginia
|
995
|
16,625,645
|
3.2
|
|||||||||
Washington
|
586
|
9,825,128
|
1.9
|
|||||||||
West Virginia
|
171
|
2,693,267
|
0.5
|
|||||||||
Wisconsin
|
552
|
9,893,775
|
1.9
|
|||||||||
Wyoming
|
34
|
404,701
|
0.1
|
|||||||||
Other
|
163
|
4,464,876
|
0.9
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
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
|
15,610
|
$
|
224,106,853
|
43.2
|
%
|
|||||||
Other Repayment Options(1)
|
9,562
|
169,482,168
|
32.7
|
|||||||||
Income-driven Repayment(2)
|
3,755
|
124,666,825
|
24.1
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
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
|
14,166
|
$
|
212,171,587
|
40.9
|
%
|
|||||||
Unsubsidized
|
14,761
|
306,084,259
|
59.1
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
DISTRIBUTION OF THE TRUST STUDENT LOANS
BY DATE OF DISBURSEMENT AS OF
THE STATISTICAL DISCLOSURE DATE
|
||||||||||||
Disbursement Date
|
Number
of Loans
|
Aggregate Outstanding
Principal Balance
|
Percent of Pool
by Outstanding
Principal Balance
|
|||||||||
September 30, 1993 and earlier
|
19
|
$
|
1,185,007
|
0.2
|
%
|
|||||||
October 1, 1993 through June 30, 2006
|
28,908
|
517,070,839
|
99.8
|
|||||||||
July 1, 2006 and later
|
0
|
0
|
0.0
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
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
|
3,845
|
$
|
57,453,204
|
11.1
|
%
|
|||||||
College Assist
|
35
|
505,378
|
0.1
|
|||||||||
Educational Credit Management Corporation
|
6,186
|
104,710,307
|
20.2
|
|||||||||
Florida Off Of Student Fin’l Assistance
|
4,321
|
72,821,832
|
14.1
|
|||||||||
Great Lakes Higher Education Corporation
|
10,699
|
220,089,134
|
42.5
|
|||||||||
Kentucky Higher Educ. Asst. Auth.
|
442
|
6,615,742
|
1.3
|
|||||||||
Michigan Guaranty Agency
|
190
|
3,372,012
|
0.7
|
|||||||||
Nebraska National Student Loan Program
|
142
|
2,352,894
|
0.5
|
|||||||||
Oklahoma Guaranteed Stud Loan Prog
|
171
|
2,247,264
|
0.4
|
|||||||||
Pennsylvania Higher Education Assistance Agency
|
711
|
11,292,763
|
2.2
|
|||||||||
Texas Guaranteed Student Loan Corp
|
2,185
|
36,795,316
|
7.1
|
|||||||||
Total
|
28,927
|
$
|
518,255,846
|
100.0
|
%
|
*
|
Represents a percentage greater than 0% but less than 0.05%.
|
Federal Fiscal Year
|
Federal Guaranty Reserve
Fund Level1
|
2015
|
1.05%
|
2016
|
1.37%
|
2017
|
1.80%
|
2018
|
2.21%
|
2019
|
0.64%
|
Federal Fiscal Year
|
Federal Guaranty Reserve
Fund Level1
|
2014
|
0.277%
|
2015
|
0.251%
|
2016
|
0.308%
|
2017
|
0.350%
|
2018
|
0.363%
|
Federal Fiscal Year
|
Federal Guaranty Reserve
Fund Level1
|
2014
|
0.377%
|
2015
|
0.295%
|
2016
|
0.373%
|
2017
|
0.430%
|
2018
|
0.460%
|
Federal Fiscal Year
|
Claims Rate
|
2015
|
0.96%
|
2016
|
1.00%
|
2017
|
0.35%
|
2018
|
0.35%
|
2019 | 2.00% |
Federal Fiscal Year
|
Claims Rate
|
2014
|
4.73%
|
2015
|
4.71%
|
2016
|
0.60%
|
2017
|
0.67%
|
2018
|
2.15%
|
Federal Fiscal Year
|
Claims Rate
|
2014
|
1.37%
|
2015
|
0.60%
|
2016
|
1.31%
|
2017
|
0.63%
|
2018
|
1.52%
|
Reserve Ratio
|
||||||||||||||||||||
Federal Fiscal Year
|
||||||||||||||||||||
Guarantor
|
2014
|
2015
|
2016
|
2017
|
2018
|
|||||||||||||||
ECMC
|
1.433
|
%
|
1.994
|
%
|
2.532
|
%
|
3.232
|
%
|
3.878
|
%
|
Claims Rate
|
||||||||||||||||||||
Federal Fiscal Year
|
||||||||||||||||||||
Guarantor
|
2014
|
2015
|
2016
|
2017
|
2018
|
|||||||||||||||
ECMC
|
3.38
|
%
|
0.66
|
%
|
0.19
|
%
|
0.05
|
%
|
0.77
|
%
|
Recovery Rate*
|
||||||||||||||||||||
Federal Fiscal Year
|
||||||||||||||||||||
Guarantor
|
2016
|
2017
|
2018
|
2019
|
2020
|
*
|
||||||||||||||
ECMC
|
36.84
|
%
|
40.43
|
%
|
36.94
|
%
|
17.92
|
%
|
8.47
|
%
|
Federal Fiscal Year
(Ending September 30)
|
Cumulative
Recovery Rate
|
2013
|
74.0%
|
2014
|
77.4
|
2015
|
83.0
|
2016
|
86.8
|
2017 | 89.8 |
Federal Fiscal Year
(Ending September 30)
|
Reserve Ratio
|
2013
|
0.257%
|
2014
|
0.260
|
2015
|
0.273
|
2016
|
0.298
|
2017 | 0.311 |
Federal Fiscal Year
(Ending September 30)
|
Claims Rate
|
2013
|
2.0%
|
2014
|
1.7
|
2015
|
0.5
|
2016
|
0.5
|
2017 | 0.5 |
ASA Fiscal Year
(Ending June 30)
|
Default Claims
(Dollars in Millions)
|
2014
|
$617
|
2015
|
216
|
2016
|
138
|
2017 |
115 |
2018
|
127
|
ASA Fiscal Year
(Ending June 30)
|
Default Recoveries
(Dollars in Millions)
|
2014
|
$548
|
2015
|
610
|
2016
|
561
|
2017 |
499 |
2018
|
382
|
• |
default of the borrower;
|
• |
the death, bankruptcy or permanent, total disability of the borrower;
|
• |
closing of the borrower’s school prior to the end of the academic period;
|
• |
false certification of the borrower’s eligibility for the loan by the school; and
|
• |
an unpaid school refund.
|
• |
Subsidized Stafford Loans to students who demonstrated requisite financial need;
|
• |
Unsubsidized Stafford Loans to students who either did not demonstrate financial need or require additional loans to supplement their Subsidized Stafford Loans;
|
• |
Parent Loans for Undergraduate Students, known as “PLUS Loans,” to parents of dependent students whose estimated costs of attending school exceeded other available financial aid; and
|
• |
Consolidation Loans, which consolidated into a single loan a borrower’s obligations under various federally authorized education loan programs.
|
• |
is a United States citizen, national or permanent resident;
|
• |
has been accepted for enrollment or is enrolled and is maintaining satisfactory academic progress at a participating educational institution;
|
• |
is carrying at least one-half of the normal full-time academic workload for the course of study the student is pursuing; and
|
• |
meets the financial need requirements for the particular loan program.
|
Date of First Disbursement
|
Special Allowance Margin
|
|
Before 10/17/86
|
3.50%
|
|
From 10/17/86 through 09/30/92
|
3.25%
|
|
From 10/01/92 through 06/30/95
|
3.10%
|
|
From 07/01/95 through 06/30/98
|
2.50% for Stafford Loans that are in In-School, Grace or Deferment
|
|
3.10% for Stafford Loans that are in Repayment and all other loans
|
||
From 07/01/98 through 12/31/99
|
2.20% for Stafford Loans that are in In-School, Grace or Deferment
|
|
2.80% for Stafford Loans that are in Repayment and Forbearance
|
||
3.10% for PLUS, SLS and Consolidation Loans
|
Date of First Disbursement
|
Special Allowance Margin
|
|
From 01/01/00 through 09/30/07
|
1.74% for Stafford Loans that are in In-School, Grace or Deferment
|
|
2.34% for Stafford Loans that are in Repayment and Forbearance
|
||
2.64% for PLUS and Consolidation Loans
|
||
From 10/01/07 and after
|
1.19% for Stafford Loans that are In-School, Grace or Deferment
|
|
1.79% for Stafford Loans that are in Repayment and PLUS
|
||
2.09% for Consolidation Loans
|
Date of First Disbursement
|
Maximum Origination Fee
|
Before 07/01/06
|
3.0%
|
From 07/01/06 through 06/30/07
|
2.0%
|
From 07/01/07 through 06/30/08
|
1.5%
|
From 07/01/08 through 06/30/09
|
1.0%
|
From 07/01/09 through 06/30/10
|
0.5%
|
From 07/01/10 and after
|
0.0%
|
• |
federal reimbursement of Stafford Loans made by eligible lenders to qualified students;
|
• |
federal interest subsidy payments on Subsidized Stafford Loans paid by the Department of Education to holders of the loans in lieu of the borrowers’ making interest payments during in-school, grace and deferment periods or, in
certain cases, during enrollment in an income-based repayment plan; and
|
• |
special allowance payments representing an additional subsidy paid by the Department of Education to the holders of eligible Stafford Loans.
|
Trigger Date
|
Borrower Rate
|
Maximum Borrower Rate
|
Interest Rate Margin
|
|||
Before 10/01/81
|
7%
|
N/A
|
N/A
|
|||
From 01/01/81 through 09/12/83
|
9%
|
N/A
|
N/A
|
|||
From 09/13/83 through 06/30/88
|
8%
|
N/A
|
N/A
|
|||
From 07/01/88 through 09/30/92
|
8% for 48 months; 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%
|
N/A
|
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 loans
|
5.6%, 6.8%
|
N/A
|
• |
the applicable maximum borrower rate
|
• |
the sum of
|
• |
the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held before that June 1,
|
• |
the applicable interest rate margin.
|
• |
while the borrower is a qualified student,
|
• |
during the grace period,
|
• |
during prescribed deferment periods, and
|
• |
in certain cases, during a borrower’s enrollment in an income-based repayment plan.
|
• |
satisfaction of need criteria, and
|
• |
continued eligibility of the loan for federal insurance or reinsurance.
|
Dependent Students
|
Independent Students
|
|||||||||||||||||||||||||||
Borrower’s Academic Level
|
Subsidized
and
Unsubsidized
on or after
10/1/93
|
Subsidized
and
Unsubsidized
on or after
7/1/07
|
Subsidized
and
Unsubsidized
on or after
7/1/08
|
Additional
Unsubsidized
only on
or after
7/1/94
|
Additional
Unsubsidized
only on
or after
7/1/07 |
Additional
Unsubsidized
only on
or after
7/1/08
|
Maximum
Annual
Total
Amount
|
|||||||||||||||||||||
Undergraduate (per year):
|
||||||||||||||||||||||||||||
1st year
|
$
|
2,625
|
$
|
3,500
|
$
|
5,500
|
$
|
4,000
|
$
|
4,000
|
$
|
4,000
|
$
|
9,500
|
||||||||||||||
2nd year
|
$
|
3,500
|
$
|
4,500
|
$
|
6,500
|
$
|
4,000
|
$
|
4,000
|
$
|
4,000
|
$
|
10,500
|
||||||||||||||
3rd year and above
|
$
|
5,500
|
$
|
5,500
|
$
|
7,500
|
$
|
5,000
|
$
|
5,000
|
$
|
5,000
|
$
|
12,500
|
||||||||||||||
Graduate (per year)
|
$
|
8,500
|
$
|
8,500
|
$
|
8,500
|
$
|
10,000
|
$
|
12,000
|
$
|
12,000
|
$
|
20,500
|
||||||||||||||
Aggregate Limit:
|
||||||||||||||||||||||||||||
Undergraduate
|
$
|
23,000
|
$
|
23,000
|
$
|
31,000
|
$
|
23,000
|
$
|
23,000
|
$
|
26,500
|
$
|
57,500
|
||||||||||||||
Graduate (including undergraduate)
|
$
|
65,500
|
$
|
65,500
|
$
|
65,500
|
$
|
73,000
|
$
|
73,000
|
$
|
73,000
|
$
|
138,500
|
• |
The loan limits include both FFELP and Federal Direct Lending Program (FDLP) loans.
|
• |
The amounts in the final column represent the combined maximum loan amount per year for Subsidized and Unsubsidized Stafford Loans. Accordingly, the maximum amount that a student may borrow under an Unsubsidized Stafford Loan
is the difference between the combined maximum loan amount and the amount the student received in the form of a Subsidized Stafford Loan.
|
• |
Independent undergraduate students, graduate students and professional students were permitted to borrow the additional amounts shown in the third and fourth columns. Dependent undergraduate students were also permitted to
receive these additional loan amounts if their parents were unable to provide the family contribution amount and could not qualify for a PLUS Loan.
|
• |
Students attending certain medical schools were eligible for $38,500 annually and $189,000 in the aggregate.
|
• |
The annual loan limits were sometimes reduced when the student was enrolled in a program of less than one academic year or has less than a full academic year remaining in his program.
|
Outstanding FFELP Indebtedness
|
Maximum Repayment Period
|
|
$7,500-$9,999
|
12 Years
|
|
$10,000-$19,999
|
15 Years
|
|
$20,000-$30,000
|
20 Years
|
|
$30,001-$59,999
|
25 Years
|
|
$60,000 or more
|
30 Years
|
|
Note: Maximum repayment period excludes authorized periods of deferment and forbearance.
|
• |
enrolled in an approved graduate fellowship program or rehabilitation program;
|
• |
seeking, but unable to find, full-time employment, subject to a maximum deferment of three years; or
|
• |
having an economic hardship, as defined in the Higher Education Act, subject to a maximum deferment of three years; or
|
• |
serving on active duty during a war or other military operation or national emergency, or performing qualifying National Guard duty during a war or other military operation or national emergency, subject to a maximum deferment
period of three years, and effective July 1, 2006 on loans made on or after July 1, 2001.
|
• |
the applicable maximum borrower rate
|
• |
the sum of:
|
• |
the applicable 1-year Index or the bond equivalent rate of 91-day Treasury bills, as applicable,
|
• |
the applicable interest rate margin.
|
Trigger Date
|
Borrower Rate
|
Maximum
Borrower
Rate
|
Interest
Rate
Margin
|
|||
Before 10/01/81
|
9%
|
N/A
|
N/A
|
|||
From 10/01/81 through 10/30/82
|
14%
|
N/A
|
N/A
|
|||
From 11/01/82 through 06/30/87
|
12%
|
N/A
|
N/A
|
|||
From 07/01/87 through 09/30/92
|
1-year Index + Interest Rate Margin
|
12%
|
3.25%
|
|||
From 10/01/92 through 06/30/94
|
1-year Index + Interest Rate Margin
|
PLUS 10%,
SLS 11%
|
3.10%
|
|||
From 07/01/94 through 06/30/98
|
1-year Index + Interest Rate Margin
|
9%
|
3.10%
|
|||
From 07/01/98 through 06/30/06
|
91-day Treasury + Interest Rate Margin
|
9%
|
3.10%
|
|||
From 07/01/06
|
8.5%
|
8.5%
|
N/A
|
• |
the borrower rate is set at the maximum borrower rate and
|
• |
the sum of the average of the bond equivalent rates of 91-day Treasury bills auctioned during that quarter and the applicable interest rate margin exceeds the maximum borrower rate.
|
Claims Paid Date
|
Maximum
|
5% Trigger
|
9% Trigger
|
|||||||||
Before October 1, 1993
|
100
|
%
|
90
|
%
|
80
|
%
|
||||||
October 1, 1993 — September 30, 1998
|
98
|
%
|
88
|
%
|
78
|
%
|
||||||
On or after October 1, 1998
|
95
|
%
|
85
|
%
|
75
|
%
|
Source
|
Basis
|
|
Insurance Premium
|
Up to 1% of the principal amount guaranteed, withheld from the proceeds of each loan disbursement
|
|
Loan Processing and Issuance Fee
|
0.40% of the principal amount guaranteed, paid by the Department of Education
|
|
Account Maintenance Fee
|
Originally 0.10%, which was reduced to 0.06% on October 1, 2007, of the original principal amount of loans outstanding, paid by the Department of Education
|
|
Default Aversion Fee
|
1% of the outstanding amount of loans submitted by a lender for default aversion assistance, minus 1% of the unpaid principal and interest paid on default claims, which is paid once per loan by
transfers out of the Student Loan Reserve Fund
|
|
Collection Retention Fee
|
16% of the amount collected on loans on which reinsurance has been paid (10% or 18.5% of the amount collected for a defaulted loan that is purchased by a lender for consolidation or rehabilitation,
respectively), withheld from gross receipts
|
• |
borrowing through Clearstream, Luxembourg or Euroclear for one day until the purchase side of the day trade is reflected in their Clearstream, Luxembourg or Euroclear accounts, in accordance with the clearing system’s customary
procedures;
|
• |
borrowing the Global Securities in the U.S. from a DTC participant no later than one day before settlement, which would give the Global Securities sufficient time to be reflected in their Clearstream, Luxembourg or Euroclear
account in order to settle the sale side of the trade; or
|
• |
staggering the value dates for the buy and sell sides of the trade so that the value date for the purchase from the DTC participant is at least one day before the value date for the sale to the Clearstream, Luxembourg
participant or Euroclear participant.
|
• |
each clearing system, bank or other financial institution that holds customers’ securities in the ordinary course of its trade or business in the chain of intermediaries between the beneficial owner and the U.S. entity required
to withhold tax complies with applicable certification requirements, and
|
• |
that holder takes one of the following steps to obtain an exemption or reduced tax rate:
|
1. |
Exemption for non-U.S. person—Form W-8BEN or Form W-8BEN-E. Non-U.S. persons that are beneficial owners can obtain a complete exemption from the withholding tax. To obtain this exemption, they are
generally required to file a signed Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals)) or Form W-8BEN-E (Certificate of Status of Beneficial Owner for
United States Tax Withholding and Reporting (Entities)).
|
2. |
Exemption for non-U.S. persons with effectively connected income—Form W-8ECI. A non-U.S. person, including a non-U.S. corporation or partnership, for which the income is effectively connected with
its conduct of a trade or business in the United States, can obtain an exemption from the withholding tax with respect to the notes by filing Form W-8ECI (Certificate of Foreign Person’s Claim That Income Is Effectively Connected
With the Conduct of a Trade or Business in the United States).
|
3. |
Exemption or reduced rate for non-U.S. persons resident in treaty countries — Form W-8BEN or Form W-8BEN-E. Non-U.S. persons that are beneficial owners residing in a country that has a tax treaty
with the United States can obtain an exemption or reduced tax rate, depending on the treaty terms, by filing Form W-8BEN or Form W-8BEN-E.
|
4. |
Exemption for U.S. persons—Form W-9. U.S. persons can obtain a complete exemption from the withholding tax by filing Form W-9 (Request for Taxpayer Identification Number and Certification)
certifying that they are not subject to U.S. backup withholding tax.
|
• |
a citizen or individual resident of the United States,
|
• |
a corporation or partnership, including an entity treated as such for U.S. federal income tax purposes, organized in or under the laws of the United States or any state thereof or the District of Columbia,
|
• |
an estate the income of which is includible in gross income for U.S. federal income tax purposes, regardless of its source, or
|
• |
a trust whose administration is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust.
|
ELIGIBLE LENDER TRUSTEE
DEUTSCHE BANK TRUST COMPANY AMERICAS
1761 East St. Andrew Place
Santa Ana, CA 92705
|
DELAWARE TRUSTEE
BNY MELLON TRUST OF DELAWARE
301 Bellevue Parkway
Third Floor
Wilmington, Delaware 19809
|
INDENTURE TRUSTEE AND PAYING AGENT
DEUTSCHE BANK NATIONAL TRUST COMPANY
1761 E. Saint Andrew Place
Santa Ana, California 92705
|
MORGAN, LEWIS & BOCKIUS LLP
1111 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-2541
|
RICHARDS, LAYTON & FINGER, P.A.
920 N. King Street
Wilmington, Delaware 19801
|