...Many challenges remain ahead fo r the student loan market. The economic and legislative landscap e continues to apply pressure on many issuers, as several student loan securitizations have been postponed during first-quarter ####. Additionally, the cos tof funds has increased, partly due to auction-rate marke t volatility. Despite this, FFELP collateral performance has no tdeteriorated, as it benefits from a minimum ##% government guarantee. Awaiting an improvement in the capital markets an dlegislative changes, issuers have financed student loan collateral through other means, such as wa rehouse lines or internal capital sources, or have permanently or temporarily changed thei rbusiness models to not originate FFELP collateral. This disruption in the student loan market may result in governmen tintervention to provide financing to students through its lender o f last resort program as well as by purchasing FFELP student loans at par program in th e secondary market. ...

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