Preferred Lender Lists
Each school must annually make available in print or other medium to students attending the school and their families a list of the specific lenders for private education loans or for Title IV, HEA loans that the school recommends, promotes, or endorses in accordance with a preferred lender arrangement. The list must prominently disclose the method and criteria used by the school in selecting lenders for preferred lender arrangements to ensure that such lenders are selected on the basis of the best interests of the borrower. The list must also clearly and fully disclose:
- The minimum information determined by the U.S. Department of Education (HEA Section 153(a))
- Why the school participates in a preferred lender arrangement with each lender, particularly with respect to terms and conditions or provisions favorable to the borrower
That the students or their families do not have to borrow from a lender on the list
The list must have at least three FFELP lenders that are not affiliates or each other. If the list includes lenders of private education loans, there must be at least two lenders who are not affiliates. The list must indicate for each lender whether it is or is not an affiliate of the other lenders on the list. The details of each affiliation are to be disclosed. The U.S. Department of Education is required to provide to schools a list of the lender affiliates of all eligible lenders.