JPMorgan Chase Bank is marketing a FFELP student loan-backed deal called Scholar Funding Trust 2011-A. The $268.3 million, 144A transaction is managed by JPMorgan Securities.

The transaction is backed by roughly 81% rehabilitated FFELP student loans and the remaining approximately 19% are non-rehabilitated FFELP loans, according to a Moody's Investor Service presale report.

For further details on the SLABS deal, please see the link below from the ASR Scorecards database.

A rehabilitated FFELP loan is a loan that previously defaulted and has later been “rehabilitated.” For a defaulted FFELP loan to be rehabilitated or have its FFELP status back, the related borrower must make at least nine on-time payments in full on their loan.

The rating agency analysts said that they expect rehabilitated FFELP loan pools to see a higher net loss rate versus pools of non-rehabilitated FFELP loans because although the rehabilitated loans benefit from the same degree of federal guaranty, they should default at a considerably higher rate compared with non-rehabilitated loans, the rating agency said.

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