USA Funds
From Wikipedia, the free encyclopedia
USA Funds is a nonprofit corporation that works to enhance postsecondary-education preparedness, access and success by providing and supporting financial and other valued services. USA Funds links colleges, universities, proprietary schools, private lenders, students and parents to promote financial access to higher learning.
Established in Indianapolis in 1960 to help families finance rising college costs, USA Funds has grown to become the nation's largest guarantor of loans made under the Federal Family Education Loan Program (FFELP), the largest federal source of financial aid for higher education. During the past 44 years, the USA Funds guarantee has supported a total of nearly $115.5 billion in financial aid for higher education. USA Funds has served more than 13.6 million students and parents, as well as thousands of educational and financial institutions.
USA Funds guarantees education loans for students and parents throughout the nation. In addition, USA Funds serves as the designated guarantor of federal education loans in eight states: Arizona, Hawaii and the Pacific Islands, Indiana, Kansas, Maryland, Mississippi, Nevada and Wyoming.
SMS Hawaii, the nonprofit student-loan secondary market for Hawaii, is an affiliate of USA Funds.
Another USA Funds affiliate, Northwest Education Loan Association, is a nonprofit guarantor that serves the Pacific Northwest. NELA is the designated guarantor for the states of Idaho and Washington.
[edit] About USA Funds and Sallie Mae
USA Funds contracts with affiliates of Sallie Mae, the leading guarantor-servicing organization, to deliver some of the services necessary to support USA Funds’ guarantee.
Before July 31, 2000, USA Funds was an affiliate of USA Group. USA Funds contracted with other USA Group affiliates to deliver key services, including information-technology support, loan-guarantee processing, loan-status maintenance, customer service, default prevention, default recovery, sales, and marketing.
Effective July 31, 2000, Sallie Mae acquired the assets of most of the USA Group affiliates. USA Funds, however, was not included in the transaction. USA Funds became an independent, unaffiliated guarantor of student loans. USA Funds contracts with Sallie Mae affiliates, much as it previously had contracted with USA Group affiliates, for services necessary to carry out its role as a student-loan guarantor. In fact, many of the people and processes that supported USA Funds when it was part of USA Group continue to support USA Funds under USA Funds' contracts with Sallie Mae affiliates.
USA Funds is not a subsidiary of Sallie Mae. There is no corporate affiliation between the two organizations. USA Funds is governed by a board of trustees that is completely independent of the board that governs Sallie Mae. USA Funds is managed by an experienced team that has no affiliation with Sallie Mae. The services that USA Funds receives from Sallie Mae are closely monitored and directed by USA Funds employees.
Furthermore, USA Funds works with hundreds of education lenders. Some of these lenders contract with Sallie Mae for servicing and loan acquisition; others have no contractual relationships with Sallie Mae. Postsecondary institutions, their students, and parents are free to choose the lenders with which they wish to work while using the USA Funds guarantee.
