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Department of Education Proposes “Adverse Credit” Definition Change

To counter the sharp increase in loan disapprovals recently, the Department of Education has issued a notice of proposed rulemaking to update the rules of creditworthiness for PLUS loans to graduate students and parents. Published earlier this month in the Federal Register, the notice includes a revision of the “adverse credit” definition for PLUS loans, and proposes that an applicant meets the adverse credit history requirement “if the applicant has one or more debts with a total combined outstanding balance greater than $2,085 that are 90 or more days delinquent as of the date of the credit report, or that. Read More.

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