Nelnet

Roundup: Week of January 21 - January 25

Ed Policy — Fri, 25 Jan 2008 00:00:00 -0500

Economic Woes Hit Sallie Mae, Nelnet

Tightening credit markets and the slowing economy appear to be spreading into the student loan industry, as two major lenders announced recently that they will be cutting jobs and shying away from riskier loans. Last Friday, Virginia-based Sallie Mae said it would be trimming 350 jobs across the country, roughly 3 percent of its workforce. Nelnet, located in Nebraska, announced it would cut 300 jobs, about 10 percent of its workforce — its second round of major layoffs since September. Both companies also announced changes to the loan services they would be offering. Sallie Mae said it would be more selective about offering private loans to students with low credit scores and those enrolled at schools with low graduation rates. Nelnet, meanwhile, announced it would stop offering loan consolidation services and would be more selective with the loans it offered.

The job and loan cuts were among a slew of negative Sallie Mae stories this week. The loan provider also reported that increased borrowing costs and loan defaults caused the company to lose $1.6 billion in the fourth quarter of 2007. In addition, Sallie Mae revealed that the Securities and Exchange Commission has been asking questions about public disclosures by high-level executives around when they sold shares of Sallie Mae stock — a likely outgrowth of the probe into allegations of insider trading by current CEO Al Lord. Somewhere, former Sallie Mae CEO, Larry Hough, is smiling.

Cuomo Extends Study Abroad Probe with 15 Subpoenas

New York Attorney General Andrew Cuomo’s investigation of study abroad companies reappeared this week with the announcement that his office had sent subpoenas to 15 colleges and universities. The investigation originally began back in August as an outgrowth of Cuomo’s student loan investigation, which uncovered numerous improper dealings between colleges and student aid providers. Cuomo initially sent subpoenas in August and September to five study abroad providers, uncovering a series of deals in which the programs would pay colleges a portion of their fees in exchange for signing up students. Despite this, the investigation lay largely dormant until Cuomo reportedly sent subpoenas out to more than a dozen colleges this week, including prestigious institutions such as Harvard, Brown, and Columbia. According to the New York Times, these subpoenas ask colleges about their process for selecting approved study abroad programs and whether they have received any inducements to sponsor a specific program.

Three More Colleges Announce Aid Expansions

Dartmouth, Bowdoin, and Colby colleges all announced substantial changes to their financial aid packages this week, following the recent lead of Harvard and Yale. Dartmouth’s expansion is the most impressive of the three, eliminating tuition contributions for students from families making under $75,000 annually, replacing all loans with scholarships, and considering all international applications need-blind. Dartmouth’s announcement differs from plans recently unveiled by Harvard and Yale, which cut costs significantly for upper-income families but still kept some form of contribution for all families making more than $60,000 a year. Meanwhile, Colby and Bowdoin announced this week that they would eliminate all loans from current and future student aid packages and replace them with grants, an impressive move given that both have endowments well under $1 billion (subscription required).

Roundup: Week of November 26 - November 30

Ed Policy — Fri, 30 Nov 2007 00:00:00 -0500

Nelnet Audit Receives Top Prize from the Council on Integrity and Efficiency

The Inspector General's Office at the Department of Education has received the top award the government gives to federal inspector generals for its investigation into the student loan company…

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Roundup: Week of October 8 - October 12

Ed Policy — Fri, 12 Oct 2007 01:00:00 -0400

Hillary Clinton Includes Two New America Policy Proposals in Her Education Plan

Two New America policy proposals: required multi-year tuition levels and greater use of endowments to

Note: This post pre-dates Higher Ed Watch's shift to a new publishing system. For the complete original post, including any comments, please click here.

Roundup: Week of August 20 - August 24

Ed Policy — Fri, 24 Aug 2007 01:00:00 -0400

9.5% Program Cost Taxpayers $3.5 Billion Since 2001

From 2001 to 2006 the Department of Education paid out $3.5 billion under a subsidy program designed to guarantee nonprofit student loan providers a 9.5 percent rate of return, the

Note: This post pre-dates Higher Ed Watch's shift to a new publishing system. For the complete original post, including any comments, please click here.

Higher Ed Watch Investigation Pays Off

Ed Policy — Tue, 14 Aug 2007 01:00:00 -0400

In a reversal, student loan giant Nelnet will pay $1 million to settle a Nebraska investigation into deceptive marketing practices after all. Two weeks ago, Nebraska Attorney General Jon Bruning's office announced he would forgive Nelnet its original $1 million settlement commitment and close the case without further action. But after…

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Nebraska Attorney General Attacks Andrew Cuomo

Ed Policy — Thu, 09 Aug 2007 01:00:00 -0400

Nebraska Attorney General Jon Bruning (R-NE) attacked New York State Attorney General Andrew Cuomo's (D-NY) student loan investigation yesterday, saying it's "widely perceived as an embarrassment" and that student loan giant Nelnet is an "ethical, decent, and honest company."

The Nebraska Attorney General goes on to say, "I…

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Nelnet's Friend with Benefits

Ed Policy — Tue, 07 Aug 2007 01:00:00 -0400

Nebraska Attorney General Jon Bruning is a forgiving man - at least when it comes to those who are helping finance his planned campaign for the United States Senate, like his good friends at the student loan company Nelnet.

Note: This post pre-dates Higher Ed Watch's shift to a new publishing system. For the complete original post, including any comments, please click here.

Roundup: Week of July 23 - July 27

Ed Policy — Fri, 27 Jul 2007 01:00:00 -0400

Senate Unanimously Passes Bill to Reauthorize the Higher Education Act

By a vote of 95 to 0, the Senate unanimously approved legislation Tuesday that would impose new restrictions on the relationships between student loan providers and colleges,…

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Banking on Ben (Nelson) and (Richard) Burr

Ed Policy — Thu, 19 Jul 2007 01:00:00 -0400

Congress is inching closer to slashing overly generous subsidies the government provides student loan banks and increasing need-based student aid by a concomitant amount. Last week, the House approved a budget reconciliation bill that would reduce bank subsidies by $19-billion over five years and redirect the savings to expanded grant aid…

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Scare Tactics

Ed Policy — Thu, 14 Jun 2007 01:00:00 -0400

Now that Congress is taking action to make college more affordable for students and their parents, the loan industry is once again doing what it does best: spreading fear to try to protect the overly-generous subsidies that lenders get from the federal government to…

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