Moody's Investors Service will review for possible downgrade 27 classes of notes from nine private credit student loan trusts sponsored, serviced and administered by Sallie Mae.

The notes that were placed under review include eight tranches of the most junior slice of the Class A notes and 19 tranches of subordinate notes.

The underlying collateral consists of private credit student loans that are not guaranteed or reinsured under the FFELP or any other federal student loan program. The majority of the loans included in the collateral pools were originated through school financial aid offices.

According to Moody's, the review of the notes was prompted by worse than expected performance of the underlying collateral.   

Elevated delinquencies and defaults resulted in part from a tighter forbearance policy, implemented by the student loan firmin the 1Q08.

The higher-than-expected defaults significantly eroded parity level for all securitizations. Moody's stated that  parity declined to a range of 100.8% to 102.4% in May 2010 from a range of 102.4% to 103.5% in May 2009.

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