Take a look at this email from Sallie Mae.

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FROM: SALLIE MAE
DATE: MAY 2007 PRIORITY CODE: Z932256895
When calling, use this code to expedite your service.

RE: REPAYMENT OF FEDERAL STUDENT LOANS

It’s important you contact us today regarding the repayment of your Federal student loans.

Variable interest rates on student loans are scheduled to reset July 1st.* Congress also has proposed legislation that would significantly increase costs to lenders. These actions will likely force lenders to reduce or eliminate benefits offered to borrowers.

Sallie Mae is offering borrower benefits that could save you hundreds - even thousands of dollars in additional interest costs.†

Don’t delay. If we receive your application prior to July 1, Sallie Mae’s Best Rate Guarantee ensures you will secure and lock in the lowest rate available to you - either the current or new rate.

Get the facts. To receive the lowest statutory rate available to you and avoid the expected cuts to student loan programs proposed by Congress, you must act before July 1.

Special consolidation counselors have been assigned to assist you.

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Okay, I’m going to go out on a limb here, since what I say could potentially have a negative impact on our own marketing campaigns, but I’ve promised my audience transparency and honesty, and that’s what you get.

The way the second paragraph is worded implies that things are going to go badly for students if they don’t consolidate their student loans RIGHT NOW - and I have to call Bravo Sierra on that.

“Get the facts.” Okay, fact: the 91-day Treasury bill, which is the rate that federal Stafford student loans disbursed prior to July 1, 2006 are set at, has been DECLINING recently. As of yesterday’s T-Bill auction, the investment rate for the T-bill is 4.730%, down from 4.760% last week. It hasn’t been close to 5% in months and is trending downward, which means your student loan rates could decrease, rather than increase. It therefore would be in students’ best interests to wait until the end of May before rushing into a loan consolidation to see what the final rates are set at, which will be determined on May 28, 2007.

Fact: “To receive the lowest statutory rate available”… everyone’s required to give the same rate. That’s why it’s STATUTORY. Statutory = mandated by law.

Fact: proposed legislation is proposed, which means that it has to go through a labyrinth before approval. Chances are the various pieces of student loan legislation in Congress, excepting the Sunshine Act, will not pass before July 1, 2007, which means that they are not likely to take effect before July 1, 2008. Now, whether Sallie Mae reduces their borrower benefits before the beginning of the government’s fiscal year (July 1) is a business decision on their part, but for the industry as a whole, the status quo is likely to remain for at least another year.

Believe me, in the highly competitive student loan consolidation market, we at the Student Loan Network want your business just as much as our competitors - but what I think separates us from the rest of the pack is that we’ll tell you the truth, even if it may not be in our best interests - as long as it’s in yours. In return, if you do have financial aid needs, I hope you’ll look to us in the future.

As always, if you have questions about financial aid that are confusing you, please feel free to drop me a line - 206-350-1208 or FinancialAidPodcast [at] gmail [dot] com.