Stafford Loan Justice

Stafford Loans are Personal: Part 2

After receiving a stunning, stupefying response to my FOIA where Dept. of Ed claimed “no documents found,” I resubmitted the request with additional descriptions to capture the following information:

I would also like to learn the name of the sub-department within the Dept. of Ed responsible for the calculation of capitalization on Stafford loans and for carrying out Stafford loan capitalization activities through William D. Ford.

In addition, I want to obtain Dept. of Education’s internal policies, procedures, and formulas regarding:

  • Limitation(s) on capitalization of interest of Stafford unsubsidized loans
  • The annual insurable limit on account of the student
  • “The maximum aggregate amount of interest capitalized shall not be deemed to exceed such maximum aggregate amount” (according to 20 U.S.C § 10788).  What is this amount? And Department of Education policy?

Further, I stated the following transparency-related concerns:

Contrary to Department communiqués to me in a previous FOIA request on capitalization, the aforementioned information is NOT available on the Department’s Web site at I have also consulted various federal laws as well as Title 34 of the Code of Federal Regulations and not located this information. Release of the above information is in the public interest as it will offer insight into the federal student loan lending policies and policy options for Stafford loan reform. At present, there is no public information available as to how the Department of Education assesses capitalizationBorrowers have no way of knowing policies or formulas employed in configuring capitalization on their Stafford loans. This is a truth in lending and right to know issue.

I’m currently in the process of writing a fee waiver appeal.


Written by S.

May 7, 2010 at 7:15 pm