"We have participated in DL and FFELP. When we left DL and returned to FFELP it was to provide our students with a choice and greater benefits. Private lenders have provided so many needed services for students, and they have provided scholarships. The individual representatives from various lenders that we have known personally are as dedicated to the needs of the students as we are."
—Maria Parker, Director of Student Financial Services, University of Montevallo (Alabama)
"Creating a monopoly over the student loan system with Direct Lending would prove to be a very poor decision. Having competition in any business generally keeps prices low and brings new products to the market place, and it also encourages innovations that help to bring down the cost of doing business. If students were forced to use Direct Lending, I fear that not only the quality of loan benefits may be affected, but also the quality of service that students receive. We need competition in the student loan industry to maintain the balance between Direct Lending & FFELP Loans.”
—Chrystal Woodard, Financial Aid Counselor, Louisiana Tech University (Direct Loan school)
We (Congress, DOE, and schools) have a unique opportunity in which we can seize this moment to work collaboratively to create a new, innovative student loan system based on our shared principles of competition and accountability which serve everyone's best interest and that students/borrowers have a right to choose an educational loan provider, which could be the federal government or a private bank, and a process that incorporates both price and service components that benefit the student.”
—Dewey Knight, Associate Director, University of Mississippi
Students and parents should have a choice in where they borrow money. My concern is that the "new" process will be overwhelming for our current office staff and that [it]…, will add additional burdens to financial aid administrators, student account areas, and first and foremost the folks borrowing the funds."
—Ellen Foster, Director, Spring Hill College (Alabama)
Students and parents need choice …. There are so many services that FFELP lenders and guarantors provide that would have to fall upon the financial aid professionals if we are forced into DL. This just adds additional burdens on the OFA staff who are already over regulated and burdened in policing so many issues already (INS, Selective Service, drug convictions etc.). Thirty years ago we had a FISL loan program run by the "feds" and they did a lousy job of servicing and collecting the loans which in turn caused high default rates.”
—Mary Jane Towne-Denton, Financial Aid Counselor-Loan Coordinator, University of San Diego (California)
"Administering the Direct Loan process at a small school with limited staff would be problematic. Much of the reconciliation and administrative tasks are handled by lenders and that would shift to the Fin Aid/Business Offices. With no budget to hire extra staff, I am worried about being able to adequately run the program. Plus, I am worried defaults will increase without the default management strategies used by FFELP lenders.”
—Martin Case, Financial Aid Director, St. Elizabeth School of Nursing (Indiana)
"University of Tampa went to direct lending for a period but switched back to FFELP about 8 years ago. We switched back for customer service issues (for our constituents and for our counselors), our default rate went way up under Direct Lending, and to provide choice to our students & families.”
—Jackie LaTorella, Associate Director of Financial Aid, University of Tampa (Florida)
• Reforming Federal Student Aid Programs: With a focus on the students we serve
• Letter to Congress