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EFC Legal Conference. Matthew Myers – SVP, Private Loan Services [email protected] 858-248-1372 Goal Structured Solutions Largest third party student loan administrator ($19.4b AUM) Largest third party student loan special servicer ($4.5b AUM)

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EFC Legal Conference

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Efc legal conference

EFC Legal Conference

  • Matthew Myers – SVP, Private Loan Services

  • [email protected]

  • 858-248-1372

  • Goal Structured Solutions

  • Largest third party student loan administrator ($19.4b AUM)

  • Largest third party student loan special servicer ($4.5b AUM)

  • Clients include: not-for-profits, hedge funds, investment banks, colleges and universities, insurance companies, private equity and asset-backed trusts

  • Manage lifecycle of assets from origination to collections

  • We traffic in data –forecasting, modeling and valuation experts utilizing two decades of loan-level data


Data limitations

Data Limitations

There are two certainties when it comes to data:

Data is valuable

That value is limited by the experience and expertise of the entity analyzing the data, and the additional they have available at their disposal

This can be illustrated by two real world examples of how data would suggest one outcome yet the actual result is dramatically different, with significant implications for various parties


Surface similarities

Surface Similarities

Pool APool B

Asset TypePrivate Student LoansPrivate Student Loans

IssuerIssuer XIssuer X

Average FICO719712

Cosigner %84%84%

Average Balance$11.5k$14.4k

Average Loan RateL+4.49L+5.10%

Undergrad Share84%85%

But underneath the surface…


Dramatically different results

...Dramatically Different Results


Ffelp assets

FFELP Assets

Pool APool B

Asset TypeFFELP Student LoansFFELP Student Loans

Loan TypeConsolidationConsolidation

IssuerIssuer YIssuer Z

Average Balance$39k$52k

Average Loan Rate4.42%5.14%

Average Term24.1 years26.4 years

ChannelDTCDTC

Also comparable using standard loan-level data…


Widely disparate performance

...Widely Disparate Performance


Not all similar looking assets are created equal

Not All Similar-Looking Assets Are Created Equal

Attributes that play a vital role in asset performance that are not always contained in loan-level data:

Program guidelines

Non-credit worthy borrower quality

Non-FICO underwriting criteria

School type

Area of study

Origination channel

Servicer and contractual SLAs

Use of supplemental third parties

Geographic concentration


Implications of false security

Implications of False Security

While data can inform, an overreliance on incomplete data can have serious adverse consequences:

Originators – Unprofitable products

Issuers – Overestimate residual value

Investors – Buy worthless subordinate bonds and/or resids

Service providers – Overestimate fee streams

Insurers – Underpriced premiums on wraps


Data is an input like fuel

Data is an Input, Like Fuel

You can put the same fuel in a Yugo and a Ferrari and get very different results

At GS2 our data, experience and expertise ensures the Ferrari and not the Yugo


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