Scholarship News

Department of Education Issues Overview, Requests Plans for Lender of Last Resort


March 28, 2008
by Scholarships.com Staff
Just two weeks ago, Secretary of Education Margaret Spellings addressed the US House Committee on Education and Labor about its fear of a federal lending program meltdown. To the best of her ability, she tried to qualm the legislators' fears and to convince them that negative speculations were exaggerated. “More than 2,000 originating lenders participate in FFEL,” she said. “A small number of these lenders have reduced their participation or stopped originating new loans.”

Just two weeks ago, Secretary of Education Margaret Spellings addressed the US House Committee on Education and Labor about its fear of a federal lending program meltdown. To the best of her ability, she tried to qualm the legislators' fears and to convince them that negative speculations were exaggerated. “More than 2,000 originating lenders participate in FFEL,” she said. “A small number of these lenders have reduced their participation or stopped originating new loans.”

However, the Department of Education’s request for Lender of Last Resort (LLR) preparation painted a somewhat different picture. In a letter sent to 35 guarantee agencies, the Financial Student Aid’s Chief Operating Officer Lawrence Warder laid out the basic LLR provisions and asked that the guarantee agencies quickly respond with plans for enacting the emergency program, should the need arise.

With lenders leaving the Federal Family Education Loan (FFEL) program at increasing rates, both legislators and families have been feeling uneasy about college loan options. And while the department maintained that things were largely under control, the letters spoke for themselves.

The LLR provisions state that when a student eligible for federal aid is denied by at least two lenders, guarantee agencies and lenders who have signed agreements with them are responsible for awarding the loan. Being nonprofit entities, the guaranty agencies would use government funding to repay lenders for any student defaults.

To be certain that individuals have quick access to student loans, regardless of decisions made by cautious lenders, the department has asked that guaranty agencies submit their plans to put the LLR program in place.  Among other things, they were asked to prepare a timeline for issuing LLR loans to students, provide a method for informing students about LLR eligibility and plan for meeting the increased administrative requirements. Recipients of the letter were given up to 30 days to respond with a new outline for their LLR program.

Getting more college financial aid doesn’t have to be a relentless search. Scholarships.com is totally free. Connect with our massive database of millions of college scholarships at any time by searching for awards in a variety of ways. Scholarships.com offers the quickest and easiest way to search for, apply to, and win college scholarships. Start making your college education affordable or perhaps even free, by conducting a free college scholarship search at Scholarships.com.

ADVERTISEMENT

Discuss

Share your thoughts and perhaps thousands of students will benefit from your unique insight on the subject!



If you can read this, don't touch the following fields


 
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
There are scholarships for everything on Scholarships.com; for every major, every community and every kind of student. In fact, we even offer a scholarship for students interested in the chicken industry.

A Scholarship for Chicken?

January 19, 2021 10:16 AM
by Izzy Hall
There are scholarships for everything on Scholarships.com; for every major, every community and every kind of student. In fact, we even offer a scholarship for students interested in the chicken
Southern New Hampshire University plans to cut tuition costs by 50% beginning next fall. This deep tuition price cut is a silver lining to the economic pressure the coronavirus pandemic has put on students and their family’s ability to pay for college. SNHU says that making college accessible and affordable to a wider range of students is its primary goal in slashing tuition prices.

College to Offer Half Price Tuition for Fall 2021

January 7, 2021 10:44 AM
by Izzy Hall
Southern New Hampshire University plans to cut tuition costs by 50% beginning next fall. This deep tuition price cut is a silver lining to the economic pressure the coronavirus pandemic has put on
January is all about what’s new at Scholarships.com! From our new homepage to our fresh January scholarship offerings, we’re ready to explore all of what 2021 has to offer. Number one on our 2021 list? These fantastic January scholarships! A lot of scholarships open on January 1st and many have January 31st deadlines. Start your new year off right and get cracking on these eight scholarship opportunities before they’re gone!

New Year, New You, New Scholarships

January 5, 2021 1:27 PM
by Izzy Hall
January is all about what’s new at Scholarships.com! From our new homepage to our fresh January scholarship offerings, we’re ready to explore all of what 2021 has to offer. Number one on our 2021
We’re all looking forward to finally putting 2020 behind us on New Year’s Day. Though we could not have guessed what 2020 would bring us just a year ago, we can look towards the future year with a little more hope in our hearts – as well as take a look at some great scholarship opportunities that will come due during the upcoming months! Athletes, animal lovers, artists and writers – there’s a scholarship opportunity here for you to put on your 2021 calendar. Let’s ring in the new year with a list of great scholarships to start applying to today!

Look Ahead: Our 2021 Scholarship Preview

December 29, 2020 3:10 PM
by Izzy Hall
We’re all looking forward to finally putting 2020 behind us on New Year’s Day. Though we could not have guessed what 2020 would bring us just a year ago, we can look towards the future year with a
A free scholarship search at Scholarships.com can hook you up with so many options to win free financial aid towards college costs. There are quick and easy scholarships, essay scholarships, and even scholarships based on artistic portfolios and musical performances. When juggling scholarship applications, college apps, and high school classes, students may want to know – which scholarships should they apply for first? Let our guide on how to prioritize scholarship applications help get you organized.

Guide to Prioritizing Scholarship Applications

December 17, 2020 2:23 PM
by Izzy Hall
A free scholarship search at Scholarships.com can hook you up with so many options to win free financial aid towards college costs. There are quick and easy scholarships, essay scholarships, and even
HBCU Heroes, a non-profit organization dedicated to providing Historically Black College and University (HBCU) students and schools with scholarships and resources, is hosting a charity Esports tournament on Wednesday, December 16th. Rather than a tip-off on a basketball court, pro athletes and gamers will compete on the virtual courts of NBA2K. A planned $50,000 will be awarded in scholarships, prizes and collegiate Esports lab funding to HBCUs.

Charity Raises Money for HBCUs with Esports Tournament

December 15, 2020 11:34 AM
by Izzy Hall
HBCU Heroes, a non-profit organization dedicated to providing Historically Black College and University (HBCU) students and schools with scholarships and resources, is hosting a charity Esports
Tonight is the first night of Hanukkah, the eight-day festival of lights celebrated each winter by Jewish families. During Hanukkah, menorahs are lit, latkes are fried, dreidels are spun and chocolate coins are eaten. If you’re celebrating Hanukkah this year, take some time to apply to these eight Jewish scholarships – one for each night! You’ll give yourself a chance to win a “present” of free financial aid for college.

Celebrate Hanukkah with Eight Jewish Scholarships

December 10, 2020 1:48 PM
by Izzy Hall
Tonight is the first night of Hanukkah, the eight-day festival of lights celebrated each winter by Jewish families. During Hanukkah, menorahs are lit, latkes are fried, dreidels are spun and