Student loan securitizations usually come in a single flavor, private or government guaranteed, but the Vermont Student Assistance Corp. is prepping one that includes both types of loans.
The $59.7 million 2014-B is a refinancing of a transaction that the state agency completed in 1995; the loans backing the earlier deal will be transferred to the new indenture. Kroll Bond Rating Agency has assigned a preliminary A’ rating to a single tranche of notes to be issued, reflecting the higher level of risk of private student loans originated prior to 2011. The senior tranches of deals backed exclusively by Federal Education Loan Program (FFELP) loans typically earn triple-A ratings. This type of collateral is at least 97% guaranteed by the U.S. Department of Education.