Modified Special Allowance (SAP) Codes for ED Form 799 and SAP Rates Calculated from the Quarter Ending December 31, 1999

LOUISIANA STUDENT FINANCIAL ASSISTANCE COMMISSION
OFFICE OF STUDENT FINANCIAL ASSISTANCE

LOAN PROGRAM BULLETIN

TO:
Lenders and Schools
DATE:
January 5, 2000
TOPIC:
Modified Special Allowance (SAP) Codes for ED Form 799 and SAP Rates Calculated from the Quarter Ending December 31, 1999

 

To assure that your Common Manual remains current, please record this document on your LPM/LPB index, and retain it in Appendix E of your manual.

 

The Higher Education Act of 1965 was recently amended to change the method of calculating special allowance for loans first disbursed on/after January 1, 2000. The calculation will now use the 3-month commercial paper rate. This resulted in a modification to the Special Allowance (SAP) codes that are used in the Lender’s Interest and Special Allowance Request and Report (ED Form 799). Beginning with the ED Form 799 for the quarter ending March, 2000, lenders will be required to use the following SAP codes (in addition to the existing codes):

 

Please note that there has been no change to loans disbursed with tax-exempt funds. You should continue to report these loans using the existing SAP codes. If you have any questions, please call the U.S. Department of Education at (202) 708-9776, or e-mail them at OSFA_LR@ed.gov.

Annual Rate

Allowance at Annual Rate

Quarterly Factor

Loans prior to 10/1/81
7% .0175  .004375
9% .0000 .000000
Loans from 10/1/81 to 11/16/86
7% .0172 .004300
8% .0072 .001800
9-14% .0000 .000000
Loans from 11/16/86 to 10/1/92
7% .0147 .003675
7.72% .0075 .001875
7.87% .006 .001500
8% .0047 .001175
9-14% .0000 .000000
Loans from 10/1/92 to 7/1/98
6% .0232 .005800
7% .0132 .003300
7.72% .006 .001500
7.98% .0034 .000850
8% .0032 .000800
9-14% .0000 .000000
Loans from 7/1/95 to 7/1/98 only during in-school, grace and deferment
7.12% .006  .001500
Loans from 7/1/98 to 7/1/03 only during in-school, grace and deferment
6.32% .011  .002750
Loans from 7/1/98 to 7/1/03 except during in-school, grace and deferment
6.92%  .011 .002750

 

 Tax-exempt Loans

Annual Rate

Allowance at Annual Rate

Quarterly Factor

Tax-exempt loans prior to 10/1/81
7% .025  .00625
9% .005 .00125
Tax-exempt loans from 10/1/81
6% .035 .008750
6.32%  .0318  .007950
6.92%   .0258 .006450
7%  .025  .006250
7.12%   .0238 .005950
7.72%   .0178 .004450
7.87%   .0163 .004075
7.98%   .0152 .003800
8%   .015 .003750
9%   .005 .001250
10%-14%   .0000 .0000

The average bond equivalent rate of the ninety-one day Treasury bills auctioned during the quarter ending December 31, 1999 is 5.22%.

 

 

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