Blog

Browse All Blog Topics

Blog Articles For Topic Ffel

Student Loan Debate Continues as Legislation Languishes behind Health Bill


Nov 12, 2009

As the wrangling over proposed healthcare legislation drags on in the Senate, progress on other bills has stalled, including a piece of legislation that would impact federal student financial aid programs.  The Student Aid and Fiscal Responsibility Act, passed by the House of Representatives in September, has yet to see its counterpart taken up for debate in the Senate.  Yet the debate over student loan reform is heating up again as the Department of Education and lenders both attempt to press their agendas forward.

Student loan reform has been a topic of contention since President Obama announced his 2010 budget proposal at the beginning of the year.  Among them was doing away with the Federal Family Education Loan Program, which subsidizes private banks to make and service [...]

Continue Reading
86 months ago 0 comments

The House of Representatives is poised to vote today on legislation to eliminate the Federal Family Education Loan Program and increase funding for Federal Pell Grants. The bill, currently known as the Student Aid and Fiscal Responsibility Act of 2009, is widely expected to be approved by the House, possibly with some amount of bipartisan support.  While most of the provisions in the bill have [...]

88 months ago 0 comments Read More

According to newly released data, default rates on federal student loans continued to climb in 2008, reaching a nine-year high of 6.7 percent, most likely as a result of the recession. The annual cohort default rate, released by the Department of Education on Monday, covers federal student loans that went into repayment between October 2006 and September 2007 and had gone into default by [...]

88 months ago 0 comments Read More

Yesterday, the House of Representatives formally introduced legislation to reshape federal student loans, federal Pell Grants, and other aspects of student financial aid. The Student Aid and Fiscal Responsibility Act of 2009 builds on presidential budget recommendations and features several substantial changes to student aid.

A preliminary breakdown of the bill provided by the National [...]

90 months ago 0 comments Read More

Earlier this week, U.S. Bank announced that it would cease to act as a lender for Stafford Loans issued through the Federal Family Education Loan Program. U.S. Bank was the sixth largest participant in FFELP as of 2008, according to the Student Lending Analytics Blog, yet this news has caused barely a ripple.

This is partially due to the fact that the stream of lenders leaving FFELP [...]

90 months ago 0 comments Read More

With President Obama's proposal to end the bank-based Federal Family Education Loan Program, there has been much speculation on what role would be left for banks in student loans, as well as which banks would be allowed to play that role.  An announcement made yesterday by the Department of Education indicates that at least four banks will remain involved in federal student loans for the [...]

91 months ago 0 comments Read More

Yesterday, Congress held a hearing to begin the process of determining the fate of the Federal Family Education Loan Program, the bank-based federal student loan program that President Obama has proposed eliminating in the 2010 federal budget. Voices from both sides of the debate chimed in, with one clear theme emerging: in 2010, student loans are definitely going to change. The questions at [...]

92 months ago 0 comments Read More

A little over a week after announcing his plans to gear up for battle with student lenders over the future of the Federal Family Education Loan Program, President Obama has begun calling in the troops.  An e-mail message sent to young Obama supporters by the Democratic National Committee is urging students to speak up in favor of the President's proposal to switch all federal lending to the [...]

92 months ago 0 comments Read More

As Congress moves forward with a federal budget plan for 2010, rhetoric is ramping up on both sides of what is proving to be one of the most contentious budget debates so far:  whether or not to eliminate the Federal Family Education Loan Program.  President Obama initially proposed this move in his budget outline, saying that a move to Direct Loans would result in a savings of $48 billion, [...]

93 months ago 0 comments Read More

Student loan default rates increased in 2008, according to a preliminary report released by the Department of Education.  The numbers, which still aren't finalized, indicate an increase from 5.2 percent last year to 6.9 percent this year in the two-year default rate on federal student loans. The increase in default rates is likely due to continued economic difficulties facing new [...]

94 months ago 0 comments Read More

According to US Department of Education data, over the last year colleges and universities have continued to leave the Federal Family Education Loan Program in droves, switching to the federally run Direct Loans Program.  Between February 2008 and February 2009, the number of schools issuing federal Direct Loans increased from 1,072 to 1,620, an increase of nearly 34 percent.

Direct [...]

94 months ago 0 comments Read More

The student loan rescue plan that will allow the Department of Education to buy up student loans issued since 2003 will begin operating in February.  The plan will set up a bank to act as a "conduit" for purchasing older student loan assets and will also allow the Treasury to become the buyer of last resort for assets the conduit bank is unable to refinance.  The Treasury will buy up student [...]

96 months ago 0 comments Read More

Fifth Third Bank could potentially lose its right to participate in the Federal Family Education Loan Program, the Department of Education's program that allows private banks to offer Stafford Loans and PLUS loans.  An audit by the Department of Education's Office of the Inspector General suggests that Fifth Third may have offered illegal inducements to third-party lenders.  Lenders that [...]

96 months ago 0 comments Read More
View -12 More Articles