there may be some abbreviations that require explanation. SEQ means the security is a sequential-pay tranche. AFC means that tranche has an available funds cap, as discussed earlier in the chapter. MEZ stands for a mezzanine bond that provides credit support for the senior tranches but has a higher credit rating than the subordinated (SUB) bonds. Finally, EXE stands for Excess bond, this type of bond receives any cash flows in excess of the amount of principal and interest obligated to all other securities in the structure. Exhibit 10.11 presents a Bloomberg Security Description screen of shortest maturity security (A1). A1 car- ries a coupon rate of 6.27% and makes payments monthly. Note this security carries a AAA credit rating from Standard & Poors.   Student Loan-Backed Securities Student loans are made to cover college costs (undergraduate, graduate, and professional programs such as medical school and law school) and tuition for a wide range of vocational and trade schools. Securities backed by stu- dent loans, popularly referred to as SLABS (student loan asset-backed securi- ties), have similar structural features as the other ABS products we discussed.       The student loans that have been most commonly securitized are those that are made under the Federal Family Education Loan Program (FFELP). Under this program, the government makes loans to students via private lenders. The decision by private lenders to extend a loan to a student is not based on the applicants ability to repay the loan. If a default of a loan occurs and the loan has been properly serviced, then the government will guarantee up to 98% of the principal plus accrued interest. The federal government has a direct lending program-the Fed- eral Direct Student Loan Program (FDSLP)-in which the Department of Education (DOE) makes loans directly to students; however, these loans are retained by the DOE and not securitized. Loans that are not part of a government guarantee program are called alternative loans. These loans are basically consumer loans and the lenders decision to extend an alternative loan will be based on the ability of the applicant to repay the loan. Alternative loans have been securitized. As Congress did with the creation of Fannie Mae and Freddie Mac to provide liquidity in the mortgage market by allowing these entities to buy mortgage loans in the secondary market, it created the Student Loan Marketing Association ("Sallie Mae") as a government-sponsored enterprise to purchase student loans in the secondary market and to securitize pools of student loans. Its first issuance was in 1995. Sallie Mae is now the major issuer of SLABS and its issues are viewed as the benchmark issues. Other entities that issue SLABS are traditional corpo-