Lender Lists, RFIs & RFPs

ILASFAAApril 17, 2008

Questions• Why have lender lists?• What are the legal and compliance issues

surrounding a lender list?• Difference between ann RFI and RFP and why issue

one?• What categories are critical to include in an RFI? • What are new issues that have surfaced recently that

should be included in the RFI? • What is the best way to analyze the responses

offered by lenders? • What are the challenges in evaluating alternative

lenders and how can they be overcome?

Background

• DeVry issued RFP– NY AG Code of Conduct– RFP v. RFI?– Who to issue to?– Evaluation Team– Evaluation Process

Lender Lists

• Why have them?– Financial Aid Advisor: application

processor or student finance counselor?

Compliance Requirements

• Department of Education guidance

• Codes of Conduct

• Pending Legislation

Common Compliance Requirements

• FFELP Preferred lender lists must be developed with best interests of students

• List must include minimum of 3 non-affiliated lenders

• List must clearly and fully disclose basis for school selection of lender

• Schools must advise students of right to choose any lender

Components of an RFI• Student Interest must be standard of measure for all

components• Lender viability• Forward sales agreements and affiliation agreements• Electronic standards and delivery network options• Borrower Benefits• PLUS and Private Loan approval rates• Default rates• Recommended guarantor and process• Guarantor services• Lender products and services

Response Analysis

• Determine minimum thresholds or qualifications

– Annual Loan volume– Life of loan ownership or servicing– Product Line

• Process for lender questions and responses• Establish evaluation process

– Quantitative v. qualitative assessments

– Preliminary cuts– Interviews

• Establish timeline

Implementing the Decision

• Communication of decision– Respondents– School personnel– Students

• Paper v. Web Lists

• Selection basis

• Option for students to select alternative lender