Fitch Affirms SLM 2002-7 and SLM 2003-7

NEW YORK--()--Fitch Ratings affirms the senior notes at 'AAAsf' and the subordinate notes at 'Asf' issued by SLM Student Loan Trust 2002-7, and affirms the senior notes at 'AAAsf' and subordinate notes at 'BBBsf' issued by SLM Student Loan Trust 2003-7. The Rating Outlook remains Stable for all classes.

KEY RATING DRIVERS

High Collateral Quality: Both SLM 2002-7 and SLM 2003-7 collateral consists of 100% Federal Family Education Loan Program (FFELP) loans. The credit quality of the trusts collateral is high and based on the guarantees provided by the transaction's eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch affirmed and removed the U.S. 'AAA' sovereign rating from Rating Watch Negative on March 24, 2014. The Rating Outlook is Stable for the sovereign rating.

Sufficient Credit Enhancement (CE): While both the senior and subordinate notes will benefit from excess spread, the senior notes also benefit from subordination of the class B notes. As of March 2014, reported senior parity is 109.17% and reported total parity is 100% for SLM 2002-7; 104.85% and 100% for SLM 2003-7. Cash is being released from both trusts given that the 100% total parities are maintained.

Adequate Liquidity Support: Liquidity support is provided by a Reserve Fund sized at the greater of 0.25% of the pool balance and $1,975,947 for SLM Student Loan Trust 2002-7; and for SLM Student Loan Trust 2003-7, the greater of 0.25% of the pool balance and $3,761,650.

Acceptable Servicing Capabilities: Navient Solutions, Inc. (formerly known as Sallie Mae, Inc.), as servicer, will be responsible for servicing the portfolios. Fitch has reviewed the servicing operations of Navient Solutions and believes it to be an acceptable servicer of FFELP student loans.

RATING SENSITIVITIES

Since the FFELP student loan ABS relies on the U.S. government to reimburse defaults, 'AAAsf' FFELP ABS ratings will likely move in tandem with the 'AAA' U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch's published stresses could result in future downgrades. Likewise, a buildup of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

Fitch has affirmed the following ratings and Outlooks:

SLM Student Loan Trust 2002-7

-- Class A-5 at 'AAAsf'; Outlook Stable;

-- Class A-6 at 'AAAsf'; Outlook Stable;

-- Class A-7 at 'AAAsf'; Outlook Stable;

-- Class A-8 at 'AAAsf'; Outlook Stable;

-- Class A-9 at 'AAAsf'; Outlook Stable;

-- Class A-10 at 'AAAsf'; Outlook Stable;

-- Class A-11 at 'AAAsf'; Outlook Stable;

-- Class B at 'Asf'; Outlook Stable;

SLM Student Loan Trust 2003-7

-- Class A-5A at 'AAAsf'; Outlook Stable;

-- Class A-5B at 'AAAsf'; Outlook Stable;

-- Class B at 'BBBsf'; Outlook Stable

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (May 20, 2014);

--'Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria' (May 17, 2013).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708795

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=832636

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Contacts

Fitch Ratings
Jared Smith
Analyst
+1-212-908-0371
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Steven Stubbs
Senior Director
+1-212-908-0500
or
Media Relations
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com

Sharing

Contacts

Fitch Ratings
Jared Smith
Analyst
+1-212-908-0371
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Steven Stubbs
Senior Director
+1-212-908-0500
or
Media Relations
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com