USA Funds Prevents $23.7 Billion in Student Loan Defaults

Nation's leading student loan guarantor maintains 93 percent default aversion
success rate

INDIANAPOLIS, Oct. 20 /PRNewswire/ -- USA Funds®, the nation's leading
education loan guarantor, reports that it prevented $23.7 billion in defaults
on more than 1.5 million past-due federal student loan accounts during the
fiscal year ending Sept. 30. USA Funds' default prevention efforts were
successful in averting default on more than 93 percent of loan accounts on
which payments were reported by the lender as being 60 days or more past due.

USA Funds' default prevention efforts saved U.S. taxpayers an estimated $22.5
billion and student loan borrowers a projected $7.8 billion in additional
costs associated with student loan default.

"The severe economic recession has generated a significant increase in student
loan payment delinquencies," said Carl C. Dalstrom, USA Funds president and
CEO. "Despite these challenges USA Funds has worked hard to maintain its
default prevention success rate to spare taxpayers and student loan borrowers
the expense of default."

As part of its default prevention efforts, USA Funds supports a team of 250
full-time professionals who work to contact student loan borrowers who have
fallen behind in their payments and counsel them about the options for
resolving their payment issues. Those options include scheduling a payment;
flexible repayment plans, including income-based repayment options; and
deferment and forbearance to temporarily postpone or reduce a borrower's
monthly payments.

Last year this default prevention team made more than 85 million phone calls
and sent 2.7 million pieces of correspondence to borrowers to assist them in
resolving their student loan payment issues.

To promote successful student loan repayment, USA Funds supports additional
services, including online borrower counseling programs, personal finance
education for college students, as well as default prevention support to
higher education institutions.

If, in spite of these efforts, borrowers default on their loans, federal law
requires USA Funds to continue to pursue recovery of outstanding amounts owed
taxpayers. During the past fiscal year, USA Funds recovered more than $1.2
billion from borrowers in default on their loans. This figure includes more
than $459 million in rehabilitated loans, which permit borrowers who
previously defaulted on their federal student loans to restore their accounts
to repayment and improve their credit record.

Headquartered in Indianapolis, 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. For more
information about USA Funds, visit www.usafunds.org.

SOURCE USA Funds

CONTACT: Robert P. Murray, Vice President, Corporate Communications, of USA
Funds, +1-317-806-1283, bob.murray@usafunds.org