The proposed $25 billion sale of student lending giant Sallie Mae yesterday to a group including two private-equity firms, Bank of America Corp. and JPMorgan Chase & Co., caps a period of upheaval in the $85 billion college-loan market...

Sallie Mae's shares had fallen this year as it faced growing competition, a settlement with the New York attorney general over its practices, and a proposed reduction of the federal subsidies that threatens its core business model. Here's how the deal and the turmoil in the college-loan business could affect your student loan.

Q. Could this deal lead to lower interest rates on student loans in the long term?

A. Yes, lower rates could come in the new area known as "private loans" that aren't government-insured and are based on factors like a family's credit worthiness. Competition in this space has ballooned in recent years; one website, SimpleTuition.com of Newton, lists more than 30 companies pitching terms for student loans...

Q. What do the experts think?

A. Michael Dannenberg, who runs a student-loan industry watchdog group for the New America Foundation in Washington, said it remains to be seen whether the deal will improve the lending terms for the average student and worries that as a privately held company Sallie Mae would be exempt from disclosure requirements.

For the complete article, please visit The Boston Globe website.