Editor:

James Sewell’s column (“Crisis crunches student loans,” Sept. 30) misses the mark when discussing Sallie Mae’s lending practices. While some lenders have stopped offering loans as a result of the credit crunch, Sallie Mae’s commitment to make federal student loans available to all students has continued uninterrupted and remains steadfast.

Comparing the problems of Freddie Mac and Fannie Mae to Sallie Mae is inaccurate and misleading. Sallie Mae was created in 1972 as a government-sponsored entity, but in 1997 began privatizing its operations, a process completed at the end of 2004 when the company terminated ties with the federal government. Today, Sallie Mae is the nation’s leading provider of student loans and administrator of college savings plans.

Sallie Mae private education loans are originated by Sallie Mae Bank, based in Murray. We always encourage a 1-2-3 approach to paying for college: First, tap “free money” such as grants and scholarships; second, fully explore federal student loans; third, fill any gap, if needed, with private loans.

Unlike federal student loans, private loans are not government guaranteed. Sallie Mae Bank originates these unsecured loans and establishes interest rates based on the creditworthiness of the student and often a cosigner. Interest rates on Sallie Mae Bank loans are in full compliance with Utah laws. Your inference that Sallie Mae lends at “usurious rates” is patently wrong.

Sallie Mae Bank is a local company, deeply committed to Utah higher education. Our employees live and work in Utah. Some are graduates of the U, while others have children who attend there. We are proud that Sallie Mae Bank awarded $5,000 scholarships in 2008 to four U students; Aubrey Whipple, Daryle Wasden, Kody Powell and Peter Sommerkorn.

Mark B. Howard,
President and CEO,
Sallie Mae Bank