Student Loans

Student loans feeling credit crunch, too (St. Louis Post-Dispatch)

Those students, though, paid interest rates of up to 20 percent to finance their educational dreams. Stephen Burd, senior research fellow at the New America Foundation who blogs about higher education, says the lending practices got out of hand. "We actually think that this is a positive development that subprime lending in for-profit education is being curtailed, because we don't think students should have been stuck with these high-interest, high-cost… more

What An Outrage! The Money That Got Away (AARP Bulletin)

Nelnet denies it broke any laws. Still, "for a good number of years, Nelnet had a river of dirty money flowing through it," says Michael Dannenberg, director of the education policy program at the New America Foundation in Washington.

U.S. Ignores Finding on Student Lender (The New York Times)

Michael Dannenberg, director of the education policy program at the New America Foundation in Washington, sharply criticized the department’s decision to seek less than the amount identified in the audit.

“The department’s going after less than half of a fraction of the larger amount of improper billing that the Pennsylvania lending agency engaged in,” Mr. Dannenberg said. “The Department of Education’s failure to aggressively police the student loan… more

Student Aid: Will many low-income students be left out? (available for purchase from CQ Researcher online)

...The idea that having more lenders in the program improves customer service through competition doesn't make sense, says Jason Delisle, research director for education policy at the New America Foundation. The Loans are an identical commodity offered under government rules, so lenders have little room to customize loans or services, he says. In addition, lenders generally hold the loans on their own book for… more

The Assosciated Press published a review of the surge in loan elimination in private schools for middle- to upper-class income students, and quoted Michael Dannenberg, Education Program Director with the New America Foundation.

... Michael Dannenberg, a scholar at the New America Foundation, notes that's also approximately the figure Congress spent this year to cut student loan interest rates from 6.8 percent to 3.4 percent -- for the whole country. ...

Ultimately, however, other factors will play a much bigger role… more

Last week, National Journal ran an article on the recently enacted student loan auction program filled with criticisms. According to lenders, bankers, Bush political officials at the Education Department, college aid administrators' association (NASFAA), and "most" Congressional Republicans, the taxpayers' representatives should not use the market to set… more

Student loans are often categorized as good debt, because a college education is considered a sensible long-term investment. ...

But it's important to understand that not all student loans are alike. Federally guaranteed student loans, known as Stafford loans, have fixed interest rates, now 6.8%, and flexible repayment terms. Any full-time college student, regardless of family income, can take out a Stafford loan.

Private student loans, which are often offered by the same lenders that provide federal loans, are more… more

When it comes to private student loans, loan giant Sallie Mae speaks out of both sides of its mouth. Case in point: Sallie Mae officials say they go out of their way to persuade students to exhaust their federal student loan eligibility before taking out more costly private loans. Not… more

One month after President Bush reluctantly signed legislation requiring the government to auction the rights to make student loans, the Education Department is calling the new program unworkable and inflexible. Even some proponents of auctions agree, while the loan industry says that the plan will hurt borrowers by narrowing their lender choices.

The auction program is included in the College Cost Reduction and Access Act that Bush signed on September 27 despite a veto threat. The bidding requirement attracted little… more

The student lender Sallie Mae, after trying to force colleges in at least three states to provide it with contact information for potential student borrowers, is backing down.

The company, which is the nation's largest student-loan provider, described the shift in strategy after a Washington-based policy group revealed this month that the lender had filed a New York Freedom of Information Law request asking community colleges in the State University of New York system to provide it with student names,… more