Contact: Sandy Connolly, Director of Communications
Office of Higher Education
The Minnesota Office of Higher Education completed the sale of $100 million in revenue bonds to provide additional funds for its student loan program. The bond sale will enable the agency to meet continuing strong demand for the SELF Loan program.
The program was created in 1985 to provide students with long-term, low-interest educational loans. The program is operated at no cost to the state. SELF Loans are funded entirely by revenue bonds, investment earnings and loans repaid by borrowers. SELF Loan disbursements for fiscal year 2008 were $133 million for 28,000 students.
Funds generated by the bond sale, along with loan repayments from borrowers, and investment earnings will provide resources to enable the agency to make about 20,000 additional loans to students initially, and as loans are repaid, the funds can be recycled for new loans. The bond sale should ensure the availability of new SELF Loans for the next one to two years.
Minnesota students attending eligible postsecondary institutions within or outside Minnesota and non-residents attending eligible postsecondary institutions in Minnesota may apply for SELF Loans. There are no minimum or maximum income thresholds and no application fees. Students pay quarterly interest while in school and the interest rate is adjusted quarterly with a January 1, 2009 interest rate of 5.7 percent.
The bond sale was underwritten by RBC Capital Markets in Minneapolis, Minnesota. The bonds are backed by a Letter of Credit from U.S. Bank in St. Paul, Minnesota with U.S. Bank also serving as the trustee. Public Financial Management of Minneapolis served as financial advisor to the Office of Higher Education for the bond issue.
"The SELF Loan program serves a broad range of students, many of whom have exhausted their other financial aid options," said Susan Heegaard, Director of the Office of Higher Education." In these uncertain economic times, we are pleased to be able to offer this tool for students to help them complete their degrees."
The Minnesota Office of Higher Education is a cabinet-level state agency providing students with financial aid programs and information to help them gain access to postsecondary education. In addition to the SELF Loan Program, the agency administers a large need-based state grant program that supplements the Federal Pell Grant program. The agency also oversees tuition reciprocity programs, Minnesota's 529 college savings program, institutional licensing and early college awareness initiatives. In addition, the agency serves as the state's clearinghouse for data, research and analysis on postsecondary enrollment, financial aid, finance and trends.
For information about the SELF Loan program, contact the financial aid office at the college you attend or are considering attending, or contact the Minnesota Office of Higher Education at (800) 657-3866 or visit www.selfloan.org.
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