Sonnenschein Announces New Group to Address Growing Market Concerns of the Student Lending Community
April 16, 2008
(WASHINGTON, April 16, 2008) - The national law firm of Sonnenschein Nath & Rosenthal LLP announced today that it has organized a group of leading attorneys and policy professionals within its National Credit Markets and Subprime Lending Task Force to concentrate on developing solutions to the increasing market concerns facing the student lending community.
"The events of the past few weeks and months signal an emerging crisis as more and more lenders have announced that they lack the funds to make new student loans," said Fruman Jacobson, national co-head of Sonnenschein's National Credit Markets and Subprime Lending Task Force. "Sonnenschein's experienced student lending attorneys and policy professionals have organized into a group to make the best use of our talent in advising clients across diverse practice areas."
In October 2007, newly enacted federal subsidy cuts went into effect for lenders participating in the federally guaranteed student loan program. Two months earlier, the subprime mortgage market had collapsed and student loan companies feared that the ensuing economic downturn would spread to the student lending sector. Almost immediately, several large student lenders began eliminating benefits for borrowers and some left the loan program entirely.
An increasing number of lenders are limiting, suspending, and even ending their participation in the federally guaranteed student loan program. According to one source, nearly 50 student lenders -- representing 12 percent of the market -- have stopped issuing federally guaranteed loans in recent weeks. The Secretary of Education herself has likened this potential crisis of college access to an approaching hurricane.
"Student lending issues are complex and require attorneys with a particular expertise in the minutiae of the Higher Education Act, as well as the capital markets," said Jonathan Vogel, a former deputy general counsel for higher education at the U.S. Department of Education and a member of Sonnenschein's Task Force. He added, "Sonnenschein has a unique blend of lawyers and policy professionals who not only know student lending law, but also know how to clearly communicate and effectively advocate the student lending community's position to public officials in the Congress and the executive branch."
Sonnenschein has the experience and the knowledge to guide lenders, guaranty agencies, servicers, and colleges through this turbulent time. The firm has consistently provided a broad spectrum of entities with unmatched securitization and transactional counsel, thorough regulatory compliance advice, critical assistance with sensitive government investigation and litigation matters, and aggressive public policy monitoring and advocacy services. Led by Vogel and several highly experienced legal and policy professionals, the group counsels the student lending community based on a deep understanding of the law, a rapid assessment of the political climate, and the utmost respect for the students whom the student lending community serves.
Sonnenschein's focus on student lending issues cuts across practice groups and geography. We have attorneys and professionals across the country who work in litigation, corporate finance, bankruptcy, public advocacy, and communications to address the emerging issues faced by the student lending community.
At Sonnenschein, we are committed to providing the highest-quality legal and counseling services for all of our clients, all of the time. They include many of the world's most admired businesses, nonprofits and individuals. Through integrated, inter-office teamwork, we help them to prosper and grow. For more information, visit www.sonnenschein.com.
Media Contact:
Dorri Thyden
Sonnenschein Nath & Rosenthal LLP
(202) 408-6430
dthyden@sonnenschein.com
