Selling loans to a secondary market allows lenders to "recycle" their money supply to make more student loans. Many banks service and collect their own loans but consistent, pervasive, yearly changes in the federal regulations result in many more lenders selling their loans to secondary markets who specialize in the changes associated with this program. The cost associated with constant computer changes and the liability associated with student loan collections has resulted in many more lenders either selling to a secondary market or using them as a servicer.
U.S. Bank sells its loans to the Student Loan Marketing Association (Sallie Mae), the nations largest secondary market. When you use U.S. Bank as your lender, all your loans will be in one place resulting in just one monthly payment during your loan term. Additionally, Sallie Mae has various incentive programs that you may use as a consequence of borrowing from us. These programs reduce the cost to you as a borrower.
The Direct Repay "tm" Plan provides an automatic 1/4 percent interest rate reduction on student loans when you authorize automatic electronic payments.
The Great Rewards "tm" Program offers you a two percentage-point interest rate reduction if you make your first 48 scheduled monthly payments on time.
The Great Returns "tm" Program provides highly indebted Stafford borrowers whose loans are owned by Sallie Mae with an additional way of reducing the cost of higher education. The program is designed to reward borrowers with multiple Sallie Mae owned loans who pay on time with a credit to their loan accounts which is equivalent to any Federal origination fees that were paid over $250. The award will be made after 24 initial on-time scheduled monthly payments.
Stafford and unsubsidized Stafford loans Loans must be disbursed on or after July 1, 1995. Loans must be owned by Sallie Mae prior to the start of repayment and be serviced by Sallie Mae or a participating third party servicer.
Eligibility will be automatic for qualified borrowers; application for this benefit is not required.
Borrowers can take advantage of all three Sallie Mae programs simultaneously. Borrowers will be notified when the Great Returns award is credited to their accounts.
Examples: Savings available to borrowers under Direct Repay, Great Returns and Great Rewards in the order that the benefits would be earned.
Original Direct Repay Direct Repay Savings
Principal: Only & Great Under All Three
Returns Plans
$ 5,000 $ 118 $ 118 $ 386
$10,000 $ 237 $ 328 $ 852
$20,000 $ 474 $1,111 $2,102
$60,000 $1,421 $4,234 $7,095
Assumes 8% Loan Rate, Standard Repayment, and 10-Year TermGreat Rewards(R) is a registered service mark and Great Returns(SM) and Direct Repay(SM) are service marks of the Student Loan Marketing Association. Sallie Mae reserves the right to cancel these programs. Changes to the programs, if any, will not affect borrowers who previously qualified for the benefits.
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