February 6, 2008

Department Approves 7 Lenders' Bids to Remain Eligible for 9.5-Percent Returns

By Kelly Field

Washington

The U.S. Department of Education announced on Tuesday that it would allow seven lenders to bill the department at the highest subsidy rate for student loans, saying audits submitted by the lenders proved they were eligible for the 9.5-percent rate of return.

The department suspended all payments at the 9.5-percent rate a year ago, saying it would pay the higher rate only if the lenders could prove, via an audit, that they qualified for it.

Since then 15 lenders have performed

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