Key Education Resources Waiving 1 Percent Federal Default Fee for Student Loan Borrowers

CLEVELAND, April 12 /PRNewswire-FirstCall/ -- Today's college students need more than a spring break; they need a break on their college loans.

That's why Key Education Resources, one of the nation's largest education loan providers, has decided to waive the 1 percent Federal Default Fee for its Stafford and Grad PLUS Loans beginning with loans guaranteed on July 1, 2007. Absorbing this fee represents millions of dollars that Key Education Resources is saving its borrowers.

For example, if you are a student obtaining a four-year undergraduate degree you would save an average of $192 which could be used to stay connected with family by filling up the tank for car trips home or purchasing cell phone minutes. For the average professional school student, the savings over the total cost of education could be as high as $1,000, enough to buy course textbooks or new software for the laptop.

"When you're a struggling student, a little bit of money can still go a long way," says Richard Vonk, president of Key Education Resources. "Key's decision to waive this fee is one of those rare opportunities that can, in a small way, soften the blow of rising educational costs."

Since 1990, the average college tuition, fees, room and board charges have risen by nearly 60 percent, according to a report by the College Board. What's more, average college costs increased more than inflation for the past 11 years.

The Deficit Reduction Act of 2005 signed into law last year, requires education loan companies to deposit a 1 percent fee from every Stafford and Grad PLUS Loan into a federally managed reserve fund. The fund covers student loan defaults as well as default prevention initiatives.

About Key Education Resources

Key Education Resources, the education financing arm of KeyBank, is one of the largest education loan providers in the U.S. In business for more than 50 years, Key Education Resources provides federal education loans, private loans, monthly payment plans and education consolidation loans for students and families in K-12, undergraduate, graduate and professional education institutions. For more information, visit https://www.key.com/educate.

About KeyCorp

Cleveland-based KeyCorp (NYSE: KEY) is one of the nation's largest bank- based financial services companies, with assets of approximately $92 billion. Key companies provide investment management, retail and commercial banking, consumer finance, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally. For more information, visit https://www.key.com/.