The private lending sector has $8 billion in student

Question

Project SC Butler: Sentence Correction (SC2) 
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The private lending sector has $8 billion in student loans that are in default or at such serious risk to default  that it does not expect payments when it is  due and has consequently tightened credit standards for new student loans.

A) that it does not expect payments when it is

B) that payments will not be expected to be paid when

C) that it does not expect payments to be made when they are

D) that payments are not expected to be paid when they are going to be

E) that they do not expect payments when it is

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petrichor · Accepted Answer

The private lending sector has  $8 billion in student loans that are in default or at such serious risk to default that it does not expect payments when it is due  and has  consequently tightened credit standards for new student loans.

There is no problem with part after 'and' - The private lending sector has X and has Y. Parallelism is already good in the non-underlined part.

However, in the second that modifier "such risk ... that" there is a pronoun ambiguity in both A and E.

A)    that it does not expect payments when it is due 
sector is the only logical antecedent for 'it' and sector can not be due.
  E)     that they do not expect payments when it is 
"they" has no clear antecedent (loans is the only plural noun possible and they can not expect something)

B)     that payments will not be expected to be paid when 
   D)     that payments are not expected to be paid when they are going to be 
there is a meaning issue in both B and D, something cannot be expected "to be paid" when due or when they are going to be due. its called due when its not paid. 
Also in B, will not be expected? so now it is expected?

C)    that it does not expect payments to be made when they are 
Clears the pronoun ambiguity with 'they' referring logically to payments.  Correct.

generis · Answer

OFFICIAL EXPLANATION

Project SC Butler: Sentence Correction (SC2)

THE PROMPT

• MAIN ISSUE TESTED: PRONOUNS
In particular, this question tests the usage of two pronouns that refer to  different  antecedents.
As long as there is only one logical antecedent to which a pronoun refers, the pronoun is acceptable—even if more than one pronoun exists.
→ Correct:   Timothy  bought  Miranda  a present and gave  it  to  her  when  she  got home from work.

This sentence is modeled on an official question that you can find  here .

The  private lending sector  is a singular noun and takes the singular pronoun  it .
The noun  payments  is plural and requires the plural pronoun  them .

THE OPTIONS

• noun/pronoun disagreement
→ the singular pronoun  it  does not agree with the plural antecedent  payments 
ELIMINATE A
 
• strange phrasing and out-of-context passive voice construction
Hmm.
→ The passive voice in this context creates a situation in which we are not completely sure who does not expect payments to be made.

→ The phrase  will not be expected to be paid  is a little weird.
When we describe a general state of unchanging affairs, we use simple present tense, not future tense. 
KEEP, but look for a better answer

• this option seems grammatical
→ the singular pronoun  it  correctly refers to its singular antecedent  the private lending sector 
→ the plural  they  correctly refers to its plural antecedent,  payments

• this option is better than option B, so ELIMINATE B, and
KEEP

•  payments  and  to be paid  are redundant (if you have a hard time deciding, compare to option C, which is better)

• as is the case in option B, the future tense (are going to be) creates a messy sentence.
→ compare to option C, in which simple present tense is used effectively to describe a general and unchanging state of affairs
ELIMINATE D

• the plural pronoun  they  does not agree with the logical antecedent  the private lending sectors 
• the singular pronoun  it  does not agree with the plural antecedent  payments 
ELIMINATE E

The correct answer is C.

NOTES 
If you cannot decide whether an option contains clear error within 5-10 seconds of having read the option,  keep it and move on. 
As you get better at SC, force yourself to make that call within 3-5 seconds of having read the option.
In option B, for example, something is wrong, but it is not easy to articulate what that something is.
Keep such options tentatively.
When we read option C, which is better than option B, we can eliminate B.

COMMENTS

I am typing quickly to finish while both troublesome electricity and internet are working properly, so these answers may sound a bit abrupt.

These answers are range from very good to outstanding.
 petrichor  , I am bumping you to Best Community Reply.

Nice work, everyone.

AntrikshR · Answer

The private lending sector   
has   $8 billion in student loans 
that   are in default or at such serious risk to default  
-------------------------- IC
that   --  
it     does not expect   payments when it is due  
and  
  has consequently tightened credit standards for new student loans.
---We got an IC

Meaning:
The PLS (Private lending Sectors) has 8 billion in student loans.
The loans are at default or have high risk to default.
PLS is not expecting payments when they will become due and therefore PLS has tightened credit standards for new students taking loan.

--All good except for pronoun error.

A) that it does not expect payments when it is
--pronoun error

B) that payments will not be expected to be paid when
--Plug into the original statement: 
The private lending sector has $8 billion in student loans that are in default or at such serious risk to default 
-----------IC
that 
payments will not be expected to be paid when due 
and   has consequently tightened credit standards for new student loans. ----Not making any sense

C) that it does not expect payments to be made when they are
--Plug into the original statement: 
The private lending sector has $8 billion in student loans that are in default or at such serious risk to default 
-----------IC
that it   does not expect payments to be made when they   are due
and   has consequently tightened credit standards for new student loans.
-----------IC
--Makes sense

D) that payments are not expected to be paid when they are going to be
--Plug into the original statement: 
The private lending sector has $8 billion in student loans that are in default or at such serious risk to default 
-----------IC
that payments are not expected to be paid when they are going to be due
and   has consequently tightened credit standards for new student loans.----Same problem as B
E) that they do not expect payments when it is
--Plug into the original statement: 
The private lending sector has $8 billion in student loans that are in default or at such serious risk to default 
-----------IC
that they   do not expect payments when it   is due 
and   has consequently tightened credit standards for new student loans.
--Too many errors
---Wrong pronoun they for PLS
---Wrong pronoun it for payments
---Illogical subject 'payments' for 'has consequently tightened credit standards for new student loans'

IMO C

winterschool · Answer

The private lending sector has $8 billion in student loans that are in default or at such serious risk to default that it does not expect payments when it is due and has consequently tightened credit standards for new student loans.

A) that it does not expect payments when  it is   Incorrect

pronoun error - payments plural, 'when it is' it is wrong

B) that payments will not be expected to be paid  when   Incorrect

after when there is no clause
 
C)  that it does not expect payments to be made when they are   Correct

D) that payments are not expected to be paid  when they are going to be   Incorrect

wordy

E) that  they  do not expect payments when  it is   Incorrect

pronoun error- The private lending sector singular
pronoun error - payments plural, 'when it is' it is wrong

gmatway · Answer

The private lending sector(singular) has $8 billion in student loans (plural)that are in default or at such serious risk to default  that it does not expect payments when it is  due and has consequently tightened credit standards for new student loans.

clue 1 -and has = this refers that there are two things which PVT sector has suffered/ observed and the word consequently shows further step in action so we need a cause ..these two needs to be ll .
follow SVA rules and you will sail through.

A) that it does not expect payments when it is

B) that payments will not be expected to be paid when - this isn't in ll with our rethinking.

C) that it (pvt sector) does not expect payments to be made when they(payments) are

D) that payments are not expected to be paid when they( ....?..) are going to be -SVA error

E) that they do not expect payments when it is - sva error

IMO C

generis · Answer

The official explanation is  here .

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The private lending sector has $8 billion in student

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GMAT Sentence Correction (SC - EA only) Questions

The private lending sector has $8 billion in student

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