Scholarship News

More Colleges Turn To Direct Loans


September 30, 2008
by Scholarships.com Staff
The U.S. Department of Education released a series of new statistical reports last week showing a dramatic increase in participation in the federal direct lending student loan program.  Motivated largely by the economic downturn and the credit crunch of the last year, 400 new colleges joined the federal direct lending program.  Overall, student borrowing through the program has increased by 50 percent in the last year.

The U.S. Department of Education released a series of new statistical reports last week showing a dramatic increase in participation in the federal direct lending student loan program.  Motivated largely by the economic downturn and the credit crunch of the last year, 400 new colleges joined the federal direct lending program.  Overall, student borrowing through the program has increased by 50 percent in the last year.

ADVERTISEMENT

The federal direct lending program provides students at participating schools with Stafford Loans directly, instead of going through the intermediary of a bank, as is done in the Federal Family Education Loan Program (FFELP).  In previous years, borrowing through FFELP could land students with lower interest rates, as well as significant repayment incentives, but that has changed significantly since 2007 as a result of subsidy cuts and economic difficulties faced by FFELP lenders.  Since direct loans are serviced directly by the Education Department, they are largely exempt from the fallout of the credit crunch and are currently more appealing to many colleges.

There is good news for students at schools that continue to participate in FFELP, though.  Lenders are participating in the loan buyback program enacted as part of the Ensuring Continued Access to Student Loans Act passed earlier this year.  About 40 percent of the student loans in the bank system have been sold to the Education Department, with paperwork being completed on much of the remaining balance.  This move appears to have worked to allow lenders to fund loans for students, as the Education Department also reports that not a single student has had to participate in the federal "lender of last resort" program.

In other financial aid news, Congress recently approved $2.5 billion in Pell Grant funding, to help tide the program over through March 2009, at which point most spring semester grant awards should have been disbursed.  All of this news suggests that students are highly likely to be able to continue to find federal student financial aid for college, at least for the forseeable future.  Of course, finding scholarships and avoiding student loans is still a smart plan, but this news suggests that despite growing fears about the economy, federal financial aid will still be available to students who need it.

Connect with our massive database of millions of college scholarships by conducting a free scholarship search at Scholarships.com. Scholarships.com offers the simplest way to search for, apply to, and win college scholarships.

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
It’s nearly mid-January already and by now you all should have completed the FAFSA and, if you are on top of things, be applying to scholarships on a daily or at least semi-weekly basis. Even if you haven’t started the scholarship application process yet, you still have a ton of opportunities ahead of you. We are in the heart of scholarship season, with the most scholarships coming online in January of any month in 2023. Below, we put together a list of five great examples of very significant scholarships ranging from ten grand all the way up to $40,000.

Top 5 Scholarships Worth $10K to $40K in January

January 12, 2023
by Kevin Ladd
It’s nearly mid-January already and by now you all should have completed the FAFSA and, if you are on top of things, be applying to scholarships on a daily or at least semi-weekly basis. Even if you
In just a few days, 2022 will be behind us and a new year begins. Will this be your year? One very productive way to spend the next several days of winter break would be to get a jump on upcoming scholarships and January 2023 has a LOT from which you may choose.

New Year, New Scholarships; January 2023 Edition

December 28, 2022
by Kevin Ladd
In just a few days, 2022 will be behind us and a new year begins. Will this be your year? One very productive way to spend the next several days of winter break would be to get a jump on upcoming
It is officially late-December; the end of the year, the conclusion of semester one and quarter two. Hanukkah is halfway over already with Christmas and New Year’s merely days away. Students and teachers are either on break or about to be and before you know it, we’ll be kicking off 2023!

Last Chance for These 2022 Scholarship Deadlines

December 21, 2022
by Kevin Ladd
It is officially late-December; the end of the year, the conclusion of semester one and quarter two. Hanukkah is halfway over already with Christmas and New Year’s merely days away. Students and
As the cost of college continues to rise every year, more and more students are looking for scholarships to bridge the gap. And as many of you may already be aware, applying for a scholarship can take a fair amount of time and effort on your part.

Amazon Future Engineer Scholarship

December 14, 2022
by Zina Kumok
As the cost of college continues to rise every year, more and more students are looking for scholarships to bridge the gap. And as many of you may already be aware, applying for a scholarship can
So many scholarships become available in December as the college application season winds down and students look for additional ways to finance their education. As the semester comes to an end and we look forward to winter break, there are going to be so many opportunities to help you take out the absolute minimum in student loans and find scholarships that not only help you pay for school, but also stand out as major accomplishments and indicators to colleges, grad schools and future employers. Applying for and winning scholarships tells all of the aforementioned that you are someone who is ambitious and proactive and always striving to better your situation.

Top 5 December Scholarships & More

December 7, 2022
by Kevin Ladd
So many scholarships become available in December as the college application season winds down and students look for additional ways to finance their education. As the semester comes to an end and we
Metallica, an extremely popular heavy metal band from the 80’s is recently enjoying new-found popularity and relevance with a new generation, thanks to the popular television show “Stranger Things”. Not only did they create the incredibly popular song “Enter Sandman” and “One”, they have also founded the Metallica Scholars Initiative. $100,000 in scholarships will be available for students studying in career programs through Metallica’s All Within My Hands Foundation (AWMH).

Metallica Foundation Offers Trades-Based Scholarships

November 30, 2022
by Kevin Ladd
Metallica, an extremely popular heavy metal band from the 80’s is recently enjoying new-found popularity and relevance with a new generation, thanks to the popular television show “Stranger Things”.
When it comes to financial aid, there are two types that tend to be seen as the most desirable: scholarships and grants. But while most people are familiar with scholarships, grants are less well understood.

Grants: the Other Way to Get Free College Money

November 22, 2022
by Zina Kumok
When it comes to financial aid, there are two types that tend to be seen as the most desirable: scholarships and grants. But while most people are familiar with scholarships, grants are less well