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Pursuant to a congressional request, GAO provided information on the federal costs for liquidation of the Higher Education Assistance Foundation (HEAF) in fiscal year (FY) 1992. GAO noted that: (1) the net costs for HEAF liquidation in FY 1992 were $6.9 million; (2) although HEAF assets increased by $138.3 million in FY 1992, its costs were $145.2 million; (3) HEAF affiliates excused $46.5 million in loans that HEAF was unable to repay; (4) HEAF excused $2.3 million owed by two of its affiliates; and (5) the Department of Education's ability to offset the cumulative costs of the liquidation will depend on the size and characteristics of the defaulted loans it receives from HEAF and how efficiently and effectively Education collects those loans.

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