The Office of Student Financial Aid and Scholarships (OSFAS) considers every aspect of the administration of educational loans to be a vital part of its service to students and their families. In conducting the responsibilities mandated by statute, regulation, and/or other directive as well as those associated with quality service delivery, the OSFAS adheres to the following guiding principals:

  I. The OSFAS will continue to process educational loans through any lender requested by the borrower without any prejudice. When appropriate, and in what is believed to be the borrower's best interest, timely communication will be initiated to help ensure that the borrower is aware of any potential issues that might arise from the lender selection; however, the borrower's lender choice will always be honored.

  II. The OSFAS will continue to maintain a professional relationship with the four suggested lending institutions with whom it has worked for ten years or more. The bases for these relationships have always been the continuous provision of competitive borrower benefits and each lender's record of service to borrowers, service that begins at the time of application and extends throughout repayment. A review of the services provided by these lenders occurs regularly and, when appropriate, adjustment to the relationship has been initiated. Because the market for educational loans changes constantly, better opportunities may emerge from other lenders from time to time. However, these long-standing lender relationships have proven to be in the best interest of USC educational loan borrowers. The following practices will remain in effect:

      A.   When borrowing under the federal Stafford Loan Program, first-time borrowers will be able to select their lender from a list of at least four suggested lenders or they may select another lender of their choice. Once a lender is established, any future Stafford Loans will automatically be processed to the same lender unless otherwise directed by the student borrower.

      B.   Parents and graduate students who wish to borrow through the federal PLUS program will be able to select their PLUS lender from a list of at least four suggested lenders or they may select another lender of their choice. Once a lender is established, it is suggested that all future PLUS borrowing remain with that lender in order to prevent concurrent repayments.

      C.   Students who wish to borrow a private educational loan may select their lender from a list of at least four suggested educational lenders or they may select a lender of their choice. As with other borrowing for education expenses, it is generally best to stay with the same lender for any additional private loan borrowing.

III. The OSFAS and staff will never request or accept anything of value from any lender in exchange for any advantage related to loan volume, assigned placement on a "preferred lending" list, or any similar activity or benefit. Income or profit sharing relationships are clearly seen by the OSFAS as inappropriate as are any types of social or entertainment related gifts. Further, OSFAS staff will ensure that the information they provide is accurate, unbiased, and that it does not reflect any preference arising from actual or potential gain. Staff will always refrain from taking any action believed to be contrary to law, regulation, or the best interests of the students or parents being served.

IV. While the staff of the OSFAS fully appreciates the value of working in consort with lenders to improve the quality of their goods and services, no individual member or members of the OSFAS will accept anything of value, including reimbursement for associated travel, for participating on lender advisory or governing boards.

V. The OSFAS will neither request nor accept any staffing services from employees of a lender. Should there be any casual conversation between a visiting lender and a student, OSFAS officials will ensure that the lender employee does nothing to misrepresent him or herself to a student or parent in a way that might be construed as being a representative of the University. Further, the OSFAS will never participate in the branding of private educational loans with the school's name.

VI. While the OSFAS and its staff cannot control the University's colleges, departments, areas, or affiliated organizations from entering into business relationships with lending institutions involved in educational loans, these principals are intended to demonstrate disagreement with any such arrangement that could be construed to reflect impropriety with regard to that lending institution's relationship with the administration of educational loans within the University.
                                                                                                                                                                       
September 2007