President Bush Signs Repeal Of The Single Lender Rule

Enables students and families to save thousands on consolidation loans

CINCINNATI—On Thursday, June 16, 2006, President Bush signed the repeal of the Single Lender Rule, which states that if a borrower has all of their loans with a single lender, that borrower must use that lender to consolidate their loans. The repeal of the Single Lender Rule—effective on all consolidation loan applications received on or after June 15, 2006—is highly advantageous for all college students, parents, graduates and residents because they can now shop for the best lender to meet their particular consolidation needs.

In the case of Ohio, the Single Lender Rule severely limited the ability for students, graduates, parents and residents to access the State’s designated non-profit student lender—Student Lending Works, which was created to meet their specific student lending needs. “Since we launched in February 2005, we’ve been unable to help the majority of callers get the best rates for their consolidation loans because of the Single Lender Rule,” said Jeff Wallace, Student Lending Works’ Director of Marketing and Operations. “The repeal of the Single Lender Rule will give Ohio students, parents, graduates and residents a choice of loans from which to select."

Additionally, this repeal comes at a pivotal time. As of July 1st, variable interest rates on student loans are expected to jump by two percentage points—one of the largest increases in history. This is a tremendous increase that will affect every family with children in post-secondary education across the United States. There are only 14 days left for students, parents and graduates to shop for the best consolidation lender to lock into a low interest rate.

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