Report from the Lender Liaison
Amy M. Moser

A study done in 2002 by the US NEWS AND WORLD REPORT stated, “Public universities typically leave a $3,800 gap between students’ official need calculation and their actual aid, while private colleges leave a gap of more than $6,000.” This is after Stafford has been awarded.

I hate to say it, but steady growth in private credit is here to bridge the gap. What was taboo in the aid office just a few years ago is now the only opportunity some students have to fulfill their dream of a college education. The burden now lies on the lenders to develop products for those families with less than perfect credit. Those with less than perfect credit are demanding low interest rates, repayment benefits, and tax incentives.

The Coalition for Better Student Loans and NASFAA have come to an agreement about increased loan limits in the upcoming reauthorization. Some sources believe that because of the shortened Congressional calendar due to the Presidential election and an increasingly partisan atmosphere in Washington that reauthorization 2003 will not take place until 2005. We will have to wait and see. Here are the proposed Subsidized loan limit changes:

Loan limits have not been increased since 1972 except to hold the impact of the origination fee in 1986 and for upper class students in 1992.

Loan limits are only one topic of NASFAA and the Coalition have proposed:

As Tim Fitzpatrick, President and COO of Sallie Mae, said: “Student loan programs work and they work well. FFELP and Direct Lending work well as a choice for schools and fit the needs of campuses across our country.

No one wants to be in debt: However, an investment in our next generation is an investment I am willing to make. So write to your Senator and Congressman about how you believe in financial aid and it’s merits. You may find out whom you should write by logging on at www.senate.gov and www.house.gov. We are all here to make college accessible to students who want an education.