State student loan group fails to sell $300M in bonds - The Missoulian- How Does Money Lending Interest Work
However, Stipcich said in a later interview he is confident the student loan bond problems won't adversely affect Montanans with student loans this year. Of MHESAC'S remaining $900 million of its $2 billion portfolio, about $725 million is financed using fixed-rate, long-term bonds or bonds financed at a fixed spread over a given index. MHESAC finances the remaining $175 million using variable rate demand obligations, under which a separate third party has a contractual obligation to buy bonds if sellers want to sell and other buyers are unavailable. This arose after state budget director David Ewer outlined concerns in October 2006 over MHESAC's request of Schweitzer to approve up to $280 million in tax-exempt bonds to finance student loans. Learn more
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