Federal College Loan Program Gets Overhauled
September 21st, 2009 in FinanceRelated Posts
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MoreIf you’ve ever filled out a College Loan Application you know how frustrating complicated it is. Well, it’s about to get a lot simpler. Along with the simplicity, the federal loan program will no longer need a middle man creating a massive amount of savings normally paid to financial service agencies to help process the loans. No longer.
The federal loan program will use the savings to expand the quantity and value of Pell Grants they issue each year.
“The overhaul of the federal college-loan program approved last week by the House of Representatives is such a no-brainer that one wonders why it hasn’t been done before.
It cuts out the middle man by eliminating the fees paid by the government to private lenders, saving some $87 billion over the next decade, according to the nonpartisan Congressional Budget Office. That alone makes this legislation worthwhile — but, wait, there’s more.
One provision promises to streamline the loan-application form, a measure that will bring joy to the heart of any parent who has ever tried to help a son or daughter fill out the so-called Free Application for Federal Student Aid form.
The form is so frustrating and difficult to complete that, according to the Department of Education, more than 1.5 million college students who likely were eligible to receive Pell Grants in 2003-2004 didn’t apply for financial aid because they found it too confusing.”
Source: Miami Herald
