First Marblehead supports responsible lending for borrowers and is a strong proponent of the smart borrowing principle, which encourages students to access scholarships, grants and federally-guaranteed loans before considering private education loans.

In support of the smart borrowing principle, First Marblehead launched a website, www.smartborrowing.org , which provides consumer-friendly, step-by-step guide for navigating through the higher education financing process.

We recommend potential borrowers follow these steps:

• Start Early – Before high school is a good time to start having family discussions about how to pay for college.
  
  
• Estimate Your Share – Think about college costs before applying for college .
  
  
• Federal Aid First – Smart borrowing means finding all the free and low-cost financial aid before applying for a private student loan.
  
• Filling the Gap – Once you have utilized savings and exhausted your scholarship and federal aid options, fill any remaining gap with a private education loan.
  
  
• Borrowing Smart – Know that interest rates can and do change over time and that you also may be entitled to borrower benefits.

First Marblehead is committed to helping our clients deliver and promote the following as they relate to their private education loan programs and to our business.

I. First Marblehead believes students should have access to a competitive private student loan marketplace and to fair, transparent, and flexible financial solutions to achieve their education dreams.

II. We demonstrate this, and we encourage our partners to validate this commitment, through fair pricing and full compliance with all legal and regulatory disclosures from lead generation to fulfillment and servicing.

III. First Marblehead believes in the following private student loan borrower protections:

• Borrowers should see a range of APRs (range of rates) that may apply to their private student loan during the marketing and application process.
  
  
• Borrowers should not be penalized for paying-off their private loan early.
  
  
• Borrowers should be informed of and educated about the impact of full or interest-only payments while in school, or the choice of deferring payments until graduation.

Borrowers are encouraged to speak with their lender or loan servicer to understand the true, total costs of any potential loan forbearance or deferment necessary.

IV. First Marblehead and our lender clients are subject to Federal Trade Commission (FTC) jurisdiction with regard to general commercial consumer protection regulations involving marketing and advertising practices, telecommunications rules and collection activities.

V. We engage in, and encourage our partners to provide, responsible marketing through creative, transparent, accurate and non-misleading information. We also educate borrowers that private loans should supplement and not supplant the availability of grants or low cost federal financial solutions. The marketing practices used to promote programs facilitated by First Marblehead comply with all applicable laws and regulations.

VI. First Marblehead has a strict Code of Conduct which prohibits its employees from offering or receiving anything other than items of nominal value (under $50) to or from any clients or any institution of higher education, including financial aid officers.

VII. In the services that First Marblehead provides for its clients, employees do not represent or identify themselves as employees of institutions of higher education.

VIII. We and our affiliates comply with the New York State Student Lending Accountability, Transparency, and Enforcement (SLATE) Act, and New York State Attorney General's Student Loan Code of Conduct, which, among other things, ban financial benefits to get on a college's preferred lender list.

IX. First Marblehead-facilitated private loans are originated by financial institutions that are subject to oversight and examination by one or more of the following regulatory agencies: the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Bank (FRB), the National Credit Union Administration (NCUA), the Office of the Comptroller of the Currency (OCC), and the Office of Thrift Supervision (OTS). By regulation and contract, these agencies' oversight powers extend to activities performed on behalf of client lenders.

First Marblehead is committed to internal processes that ensure compliance with these guiding principles. We also commit to distribute these guidelines to our employees, clients and borrowers.

October 23, 2007