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University of Kentucky Student Loan Code of Conduct

The purpose of the federal student loan program is to provide the best possible loan terms for students and parents who borrow to help finance higher education. Private student loans are an important additional resource for many students. Students and families must receive trustworthy, reliable guidance from institutions about financial aid.

The following guidelines are a framework to provide the best possible loan terms for the students served by the University of Kentucky and to avoid conflicts or the appearance of conflicts of interest.

1. The University of Kentucky shall not enter into any revenue-sharing arrangements with any lender. A revenue-sharing arrangement is defined as any arrangement between an institution and a lender under which the lender makes Title IV loans to students attending the institution (or to the families of those students), the institution recommends the lender or the loan products of the lender and, in exchange, the lender pays a fee or provides other material benefits, including revenue or profit-sharing, to the institution or to its officers, employees, or agents.
2. No officer or employee of the financial aid office (or an employee or agent who otherwise has responsibilities with respect to educational loans) may solicit or accept any gift from a lender, guarantor, or servicer of education loans. A gift is defined as any gratuity, favor, discount, entertainment, hospitality, loan, or other item having monetary value of more than a de minimus amount. This includes a prohibition on trips for financial aid officers and other university officials paid for by lenders.
3. An employee of the financial aid office (or an employee who otherwise has responsibilities with respect to educational loans or financial aid) who serves on an advisory board, commission, or group established by a lender or guarantor (or group of lenders or guarantors) is prohibited from receiving anything of value from the lender, guarantor, or group, except for reimbursement for reasonable expenses incurred by the employee for serving on the board.
4. No officer or employee of the financial aid office (or an employee or agent who otherwise has responsibilities with respect to educational loans) may accept from a lender, or an affiliate of any lender, any fee, payment, or other financial benefit as compensation for any type of consulting arrangement or contract to provide services to or on behalf of a lender relating to educational loans.
5. Officers or employees of the financial aid office shall not steer borrowers to particular lenders or delay loan certifications. For any first-time borrower, the University of Kentucky will not assign, through award packaging or other methods, the borrower's loan to a particular lender. In addition, the university shall not refuse to certify, or delay the certification of, any loan based on the borrower's selection of a particular lender or guaranty agency.
6. The University of Kentucky shall not request or accept from any lender any offer of funds for private loans, including funds for an opportunity pool loan, to students in exchange for providing concessions or promises to the lender for a specific number of Title IV loans made, insured, or guaranteed, a specific loan volume, or a preferred lender arrangement. An opportunity pool loan is defined as a private educational loan made by a lender to a student (or to a student's family) that involves a payment by the institution to the lender for extending credit to the student.
7. The University of Kentucky shall not request or accept from any lender any assistance with call center staffing or financial aid office staffing, except that a lender may provide professional development training, educational counseling materials (as long as the materials identify the lender that assisted in preparing the materials), or staffing services on a short-term, nonrecurring basis during emergencies or disasters.
8. The university's lender comparison chart shall be based solely on the best interests of the students or parents who may use the chart, without regard to financial interests of the university. This ensures that lenders listed on the comparison chart will be those the university has determined offer the best loan services that are compatible with the needs of students/parents and the university's automated student loan systems. The recommended lender list shall be readily available via the campus website.
9. The process by which lenders are selected for inclusion on the comparison chart shall be available for review by students and parents. The criteria for selection of lenders shall be included on the comparison chart. All materials and information shall inform students that they have the right to use any lender listed on the comparison chart or any other lender of their own choosing.

In addition to the above, UK Office of Student Financial Aid staff shall abide by the ethical principles and codes of conduct outlined in the University's Ethical Principles and Code of Conduct and the National Association of Student Financial Aid Administrators' Statement of Ethical Principles and Code of Conduct for Institutional Financial Aid Professionals (PDF).

Last updated: 6/5/09