Key Legislation:
Student Aid and Fiscal Responsibility Act of 2009 »
The Ensuring Continued Access to Student Loans Act of 2008 »
Higher Education Opportunity Act of 2008 »
College Cost Reduction and Access Act »
Student Loan Scandal »
College Student Relief Act »
WASHINGTON, D.C. – U.S. Reps. George Miller (D-CA) and Rubén Hinojosa (D-TX) today joined U.S. Education Secretary Arne Duncan in urging college campuses to take prudent action to ensure that their students continue to have access to stable, low-cost federal college loans, regardless of what happens in the economy. Their letter to college presidents echoes a letter Duncan sent to institutions last month.
Colleges and universities have not slashed sticker prices in response to the economic downturn. On the contrary, tuition and fees rose 6.5 percent at public four-year colleges compared with the 2008-2009 school year and 4.4 percent at private, nonprofit, four-year institutions. Those were steeper rates of increase than in prior years, after adjusting for inflation. Over the past decade, annual increases have averaged 4.9 percent at public colleges and 2.6 percent at private colleges.It is clear that students and families are increasingly relying on Pell Grant scholarships and other forms of federal student aid to help pay for college. While college tuition prices continued to increase at rates consistent with years past, students had greater access to reliable low-cost federal loans and grant aid. The report also shows that private student loan borrowing decreased by 50 percent from one year earlier, in part due to the freezing of the credit markets.
The historic legislation, championed by President Obama and approved by the U.S. House earlier this month, is a rare and welcome chance for Congress to actually streamline government instead of just talking about it. If approved by the Senate, the Student Loan and Fiscal Responsibility Act could save taxpayers $47 billion to $87 billion over the next 10 years by eliminating the middleman role private lenders play in federal education loans.
Families who now get their Stafford or parental PLUS loans through banks or credit unions or nonprofits such as Sallie Mae would instead borrow directly from the federal government, working through school financial aid offices just as they do now.
It was a blessed relief last week, in the thick of such intractable issues as health care and Afghanistan, to see the House of Representatives pass a piece of legislation that was urgently needed, made perfect sense and — mirabile dictu — could save taxpayers billions of dollars.
Members approved a bill that would end subsidies to private lenders who currently finance college loans, putting the government directly in charge. This significant measure, a longtime goal of Democrats, would save taxpayers about $87 billion over the next decade, estimates the Congressional Budget Office.
Those savings would be used to boost student grants, improve early education and pre-school programs, support community colleges and modernize public schools.
Democrats had been working for years to pass legislation curbing subsidies to lenders. Now, with a Democrat-controlled House, and with banks pretty much in the doghouse, the measure passed the House roughly along party lines, 253–171, with only four Democrats voting against and six Republicans in favor.We suggest you learn more about the Student Aid and Fiscal Responsibility Act and read the entire editorial.
It is yet to be seen how the bill will fare in the Senate, but for now, it spells good news for students and taxpayers — especially in Texas, where, as reported by the Chronicle's Jeannie Kever, post-high school students have enrolled in record numbers for the current school year, in spite of concerns that the recession would dissuade many of them from entering college.
Community colleges told Kever that enrollment had “skyrocketed,” and preliminary data from four-year colleges show enrollment has increased in many of them too, assuaging fears that more students might opt for the cheaper community colleges.
Most telling is what happened when they went searching for collegiate opponents.
- The Maine Campus (University of Maine): "We applaud the representatives who passed what amounts to the largest higher education aid reform bill of our lives. We hope the Senate follows suit."
- The Daily Cardinal (Stanford University): "The bill will help students graduate with less debt while saving taxpayers money. Such action is wise and long overdue."
- The Lariat online (Baylor University): "Though the opposition may see this as just another area overtaken by the federal government that may lead to job loss through the industry or a burden on universities during the transition out of their respective federal lending programs, it is a risk and a burden well worth shouldering."
- Daily Pennsylvanian (University of Pennsylvania): "Private lenders have shown that they are more trouble than they are worth, and redirecting the savings into expanding grants to students is an excellent, efficient redistribution of resources. We hope the House passes this bill."
- Georgetown Voice (Georgetown University): "It is essential that the Senate passes this bill. As Hoyas who claim to strive for a diverse community, we must lend our support to initiatives like this, which are crucial to enabling people from every background to come here."
- The Daily Reveille (LSU): "It’s finally time for banks to get their hands out of private education...Banks should not be in the business of profiting off the loans of students seeking the critical skills needed to compete in a global economy. Higher education deserves better. Our nation’s undergraduates deserve every chance to succeed in America, and thus to make America succeed with them."
- Indiana Daily Student (University of Indiana): "This bill decreases government bureaucracy, increases efficiency, wastes fewer taxpayer dollars and stops payouts to financial institutions for doing absolutely nothing but shifting their losses onto taxpayers. What’s not to love?"
It is somewhat curious that if you Google "students who support FFELP" you will get the following message: No results found for "students who support FFELP".Learn why college and university papers from coast to coast support the Student Aid and Fiscal Responsibility Act.
The bill, which passed 253 to 171, would allocate about $80 billion over the next decade for new loans, community colleges, school construction and early childhood programs without increasing taxes or adding to the deficit. How? Instead of paying bankers to provide loans for which they bear no real risk, the government would make the loans directly.Mr. Dionne also remarks about how this talk over labels and "prefabricated boxes" is coloring the health care debate. We encourage you to read the entire article.
Liberals are always accused of spending money without worrying where it comes from, but in this case, costs are covered by making a government program more efficient -- yes, at the expense of bankers.
"We were paying these exorbitant subsidies to bankers who were taking government money, loaning it to somebody else, getting government guarantees that the loans would be paid back, and then taking all these profits," said Rep. George Miller (D-Calif.), the bill's champion. This, he told me, led Congress to ask itself: "Hey, chump, what is it you don't get about what's going on here?" The only knock on the proposal is ideological: that government is "taking over" the student loan program. But it's already a government program. The bill simply eliminates corporate welfare.
This is a classic case of how the Great Ideological Distortion Machine does its mischief: Instead of focusing on how the bill advances values typically regarded as "centrist" -- government efficiency, pay-as-you-go budgeting -- the banks' defenders bury the specifics behind abstract discussions of "big government." Yet I'd venture that middle-of-the-road Americans prefer that their tax money go toward education rather than to padding the profits of financial firms.
This afternoon, the House passed the Student Aid and Fiscal Responsibility Act (HR 3221) by a vote of 253-171. The bill ensures that higher education is more affordable at no additional expense to taxpayers – in fact, it saves money. More students will go to college, they will graduate with less debt, and the federal loan initiatives that they and their families depend upon will be strengthened for decades to come. The legislation will generate almost $100 billion in savings over the next 10 years that will be used to increase Pell Grant scholarships, keep interest rates on federal loans affordable, and safeguard federal student loan access for families.
Speaker Pelosi:
Education and Labor Committee Chairman George Miller (D-CA):
Chairman Miller:
“My colleague on the other side of the aisle said that this legislation is the wrong way and the wrong place to make this investment. He’s got it exactly backwards. This is the exact way to make this investment. To take the savings by cutting the subsidies to the lenders and recycling those on behalf of families and students and our community institutions so that we can expand the educational opportunities in this country. we cannot continue just to wring our hands about our competitive place in the world..we must do something about it.”
Rep. Ruben Hinojosa (D-TX):
Hinojosa:
“The legislation will increase affordability, accessibility and college completion rates particularly for first generation college low-income, minority and middle-class students. It invests $40 billion to increase the maximum annual Pell Grant scholarships to $5,550 by 2010 and 2019, $6,900 and provides low and middle income families with affordable, direct federal student loans and simplifies the application process for financial aid.”
Rep. Rob Andrews (D-NJ):
Andrews:
“The issues before the House tonight are these. Do you agree or disagree that the time has come to make college more affordable for men and women around this country by making Pell Grant scholarships more available, student loans less expensive and more available? I think most people would say, yes, we do agree with that.”
Rep. Judy Chu (D-CA) on the investments the Student Aid and Fiscal Responsibility Act makes to community colleges:
Chu:
“As a Professor for over 20 years, I know firsthand how important community colleges are to helping hard working Americans achieve their dreams. About one out of every two college students attends a community college and they are some of the hardest workers I have ever met. My students came from all walks of life - they were immigrants, single moms and laid-off workers and many of the students were the first in their families to go to college. Community colleges are the backbone of our nation’s workforce.”
Chairman Miller responds to criticism of the bill and Rep. Tim Bishop (D-NY) explains how this legislation reforms student loan practices for the benefit of both the taxpayer and the borrower:
Bishop:
“What we are doing is we are paying private lenders a subsidy so that they will have the privilege of lending federally originated money to their borrowers. We guarantee repayment of that money to the tune of 97% of the amount outstanding and the private lenders reap whatever interest payments are paid by the borrowers. This is a really, really good deal for private lenders. It is a deal that costs the American taxpayer approximately $8 billion to $9 billion a year that we don’t need to spend in that fashion. We can provide, We, the federal government, can provide the loan capital that students need.”
Let us stop here and recall how the current loan system works:
1) Federal government provides private banks with capital.
2) Federal government pays private banks a subsidy to lend that capital to students.
3) Federal government guarantees said loans so the banks don’t have any risk.
And now, the proposed reform:
1) The federal government makes the loans.
....
If it all works out, Congress will have come a way toward fixing this problem, at least when it comes to federally financed student loans. There’s already a new law that forgives part or all of the debt for graduates who go into careers in public service. Terms will be easier for low-income debtors.
Congress has a chance, starting this week, to end the boondoggle that allows private lenders to earn a handsome subsidy for making risk-free student loans that are guaranteed by the federal government. It’s a wonderful deal for the lenders — and an emphatically bad one for the taxpayers.The Washington Post said:
The House is expected to vote on Thursday on a bill that would simplify the loan system — and save the country nearly $90 billion over the next decade — by ending the subsidy program and allowing students to borrow directly from the government through their colleges and universities. To get this done, however, lawmakers will need to see through the spin and misrepresentations that have become all too common lately.
...
Lawmakers need to put aside all the noise and pass this bill.
EXCEPT FOR a lucky few, paying for college isn't easy. Judging from how long it has taken, neither is reforming how the government provides the loans that make higher education affordable to millions. Yet Wednesday, as the House considers a bill that promises to save taxpayers billions of dollars, it's clear that the right choice is to vote yes.The Student Aid and Fiscal Responsibility Act will be considered on the House floor today and tomorrow. Stay tuned for updates.
Historically, the government has kept student-loan interest rates low through two programs: one in which the feds do the lending directly; and one in which the government subsidizes private entities that offer students loans at low, set interest rates. For more than a decade, private lenders fought back attempts to end the expensive subsidy system that kept them profitable at taxpayer expense. Then came the financial crisis, during which the public-private system fell apart, and the election of President Obama, who is intent on getting rid of the private middlemen.
According to the Congressional Budget Office (CBO), if the government directly financed all federally sponsored student loans, it would save $80 billion over 10 years. House Democrats have advanced a version of the president's plan that will probably get a vote in the House Thursday; the measure would put those savings into a range of worthy programs, from aid for community colleges to school renovation to larger Pell grants.
Pay heed to local hard-headed law enforcement professionals who deal with the worst that society has to offer on a daily basis.The Student Aid and Fiscal Responsibility Act will invest $1 billion each year in competitive grants to challenge states to build comprehensive, high quality early learning systems for children birth to age 5. It will also:
Speaking out in support of increased funding for early childhood education this week were Lincoln Police Chief Tom Casady, Lancaster County Attorney Gary Lacey and his chief deputy Joe Kelly.
"It's a concept that makes complete sense to all of us in this line of work," Kelly said. "The mission is validated by research."
Studies show a return of as much as $13 for every dollar invested in care and learning systems for disadvantaged children, according to Jen Hernandez of the Nebraska Children and Families Foundation.
The return comes in the form of savings in the cost of operating the criminal justice system, welfare, schools and other public systems. Research shows that participants in early childhood programs are as much as 29 percent more likely to graduate from high school and 40 percent less likely to repeat grades or be placed in special education.
Two weeks ago, the House Education and Labor Committee, with the strong encouragement of the Obama administration, took a step toward ending the false premise that private lenders are full partners in the federally subsidized college loan program. If a bill approved by the committee becomes law, private lenders will be cut out of this program and will have to stop dining at their taxpayer-provided trough.Learn more about the benefits of the Student Aid and Fiscal Responsibility Act and read Mr. Cranford's complete column.
....
The lenders have held up the pretense that they provide better service than does an arm of the federal government and that there are actually differences among bank loans, so that students stand to benefit by picking one over the other.
Sorry, but that notion is a sham. Congress has long required that the terms of these loans be identical, regardless of whether they are issued by the government or a private lender. It doesn’t matter to the student where the money comes from — the dollar amounts, the interest rates and even the repayment terms are virtually the same.
For taxpayers, though, there is a difference, and it’s a big one. In the case of presumed “private” loans, the government pays more than it does for “direct” loans — billions of dollars more — because it guarantees the principal amount and it promises a minimal return to the lender. Banks are supposed to be compensated for taking risks, but in the case of government-subsidized student loans, they incur almost no risk. Yet they get compensated anyway.
Moreover, there’s ample evidence that some private lenders have engaged in questionable or worse behavior to persuade colleges to funnel student borrowers their way. When money is free, people will do all sorts of things to get their hands on it. And that raises questions about why lawmakers would want to perpetuate a system that promotes graft, as well as waste.
If there is anything that we learned from the "pay for play" student loan scandal, it is how little choice borrowers in the FFEL program actually have. Don't forget that in 2007, the Education Department found that one lender made at least 80 percent of students' federal loans at 921 participating colleges. That same year, the research firm Student Marketmeasure reported that 1,412 FFEL schools had one loan provider that made 80 percent of their students' federal loans, with 531 of those colleges recommending only a single lender to their students. What kind of a choice is that?
The federal college loan program that pays private lenders a generous subsidy to make loans that are guaranteed by the government is an enormous waste of money that has long served more to enrich lenders than to help students.That is why the Education and Labor Committee passed the Student Aid and Fiscal Responsibility Act with bipartisan support yesterday. As the New York Times editorial explains:
[It] would end the unnecessary private lending subsidies and plow the savings into important education programs. The bill, for example, devotes $40 billion to the all-important Pell grant program, which has allowed millions of poor and working-class students to attend college.Learn more about the Student Aid and Fiscal Responsibility Act and read the entire New York Times' editorial.
It would spend $8 billion on early-education programs and $10 billion on an initiative aimed at strengthening community colleges. It sets aside $4 billion for a school modernization and improvement program.
The consolidated program proposed in the bill would in no way expand government. The loans would be handled through colleges. They would be serviced and collected by private companies and nonprofits that are already lining up to get the work. By forcing the companies to compete, and to undergo periodic re-evaluations, Congress could get a good deal for taxpayers and better service for borrowers.
This taxpayer money is urgently needed to provide aid to students for whom a four-year college is out of reach. Earlier this week, Obama proposed to infuse $12 billion into community colleges. Another block of savings will give extra funding for Pell Grants and link them with cost-of-living increases.We encourage you to read the entire editorial, as well as learn more about the Student Aid and Fiscal Responsibility Act of 2009.
In this economic climate, Congress must fix the broken system that unnecessarily takes money from taxpayers and students. Educational investments should go straight to students.
THE WHITE HOUSE
Office of the Press
Secretary
______________________________________________________________________________
FOR IMMEDIATE
RELEASE July
15, 2009
Statement from the
President on Chairman Miller’s education reform bill
I
applaud Chairman Miller for introducing an education reform bill that will cut
giveaways to special interests, invest in our children’s future, and save
taxpayer’s money.
Chairman
Miller and I are working to end the wasteful subsidies that are given to banks
and private lenders for student loans. Instead, his legislation will make
college more affordable by paying for annual increases in Pell Grants that keep
pace with inflation. He’s also working with us to simplify financial aid
forms and increase graduation rates.
This
legislation will also help us reach the goal I set out in
Finally,
I am proud that this legislation not only pays for itself, but also saves
taxpayers money and reduces the deficit. I look forward to working with
the Chairman and Congress to make this bill even stronger and pass it before
the end of the year.
- Facilitating transfer of credit articulation agreements;
- Expanding academic and training programs that provide relevant job-skill training for high-wage occupations in high-demand industries;
- Improving student support services including those identified under the Workforce Investment Act;
- Creating workforce programs that blend basic skills and occupational training leading to industry-recognized credentials;
- Building and enhancing linkages including dual enrollment programs and early college high schools as well as improving remedial and adult education programs; and
- Implementing reform programs to increase completion rates and provision of training for students to enter high-wage occupations in high-demand industries.
About 6 million students received the Pell Grant scholarship in 2007-2008.
Nationwide about 5.5 million students borrow these loans each year.
Last year approximately 495,000 students received a Perkins Loan.
In 2003-2004, over 1.5 million college students who likely were eligible to receive Pell Grants didn’t apply for financial aid because they found the FAFSA form too confusing.
Fix loan system for a stronger future
By: Rep. George Miller
This summer, millions of students will sit down with their families to figure out how to pay for college. They will unwittingly enter into a financial lending system that is badly broken — and not benefiting them as intended.
However, if Congress and President Barack Obama are successful, this system is about to undergo a major change.
The college financing system that was supposed to ensure all students access to college is dangerously out of control, for three reasons.
First, tuition has skyrocketed and shows no signs of abating.
Second, the roller-coaster credit markets have put the federally guaranteed student loan program, which for years has originated almost three-quarters of all federal college loans, on life support.
"This program will provide much-needed relief to Illinois students and families who are already struggling in this tough economy," said U.S. Rep. Phil Hare, D-Rock Island, who approved the legislation. "We should be rewarding those who pursue a higher education, not crippling them with debt. When the best and the brightest students can afford to go to college, we all benefit."
Under the Public Service Loan Forgiveness Program, the Obama administration announced yesterday [although this provision was enacted 2 years ago by Congress], people with student loans can have their debts erased after 10 years of public service. Let's say Dr. Feelgood graduates from medical school with a mountain of student loan debt. Her heart, and a little angel on one shoulder, tell her to work in a clinic serving a low-income community on tribal lands, but that little devil on her other shoulder says to become a plastic surgeon in Beverly Hills. And the little devil is holding her empty pocketbook as evidence to back his case.and the Daily Texan speaks to a student who will benefit from the new provision because she is entering public service.
If the doctor follows her heart and makes 120 payments -- one a month for 10 years -- on her student loan, Uncle Sam will tell her to forget the rest of the money she owes.
Elisheba Evans, a former UT English student who transferred to the University of North Texas, is paying off her UT-Austin student loans.Learn more about public service loan forgiveness (pdf) and read other blog posts on the benefits from the College Cost Reduction and Access Act.
She said the program’s forgiveness clause will benefit her in her career choice as a science teacher.
“It’s good that there is a system in place to reward people going into [public service] because you aren’t making that much at all,” Evans said.
“These benefits are guaranteed, no matter what happens in our economy, and are kicking in at exactly the right time for millions of Americans,” said Representative George Miller, Democrat of California and chairman of the House education committee.
“Confusing paperwork shouldn’t stand between qualified students and a college degree,” said Rep. George Miller, a California Democrat who is chairman of the House Committee on Education and Labor. A law passed last year helped, creating a two-page form for some low-income families.
But what if you have a job, but not a lot of income? Under the Income-Based Repayment plan (IBR) your payments are capped to no more than 15% of discretionary income, an amount that is based on the federal poverty guideline. "Discretionary income" is defined as the difference between adjusted gross income and 150 percent of the federal poverty line that corresponds to your family size and the state you live in (from www.finaid.org).
First, income-based repayment will only be available for federal student loans that are in good standing. Under this plan, borrowers' monthly payments will be capped at 15% of the amount by which their income exceeds the federal poverty level (currently $16,245).There are additional circumstances for married couples filing jointly, students in deferment, and medical students to consider. We encourage you to read the entire article (and use their cool income-based repayment calculator to see your potential monthly savings).
Let's say you have an adjusted gross income of $30,000. That means your pay exceeds the federal poverty level by $13,755 a year, or $1,146.25 a month. Under the new program, you would owe 15% of that amount, or $171.94, per month, regardless of your total outstanding loan balance.
If you left school owing $40,000 in federal loans, you would pay $460.32 a month under the standard 10-year plan. By choosing the income-based repayment plan, you would save 63% per month (by lengthening the life of the loan, however, you will end up paying more in interest over time.)
This is a system that goes something like this:We encourage you to learn more about the President's proposal, read the entire editorial and review the highlights from our recent hearing on this subject.
Are you with me so far? Wait, I see a hand waving back there. What’s that, sir? You want to know why the government doesn’t just lend the money out itself? Excellent question!
- We the taxpayers pay the banks to make loans to students.
- We the taxpayers then guarantee the loans so the banks won’t lose money if the students don’t pay.
- We the taxpayers then buy back the loans from the banks so they can make more loans to students, for which we will then pay them more rewards.
The White House estimates that it could save about $94 billion over 10 years if it cut out all the middlemen. And it has the basis of a system in place, since the Department of Education already makes a lot of direct loans to students.
An article in Newsday recently declared that the “recession is pushing college out of reach.” That’s a sobering thought—particularly because a college education can be a key path to a stronger financial future for many Americans.Starting July 1, there will be new help for recent grads -- or those who have been out of school for a while and are struggling to repay student loans. The new federal Income-Based Repayment program will allow those with low incomes to pay as little as zero on their student loans, as long as they qualify based on income and amount of debt.The rules are a little complicated, but you can visit www.IBRinfo.org. to use their online calculator to see if you are eligible.
Currently, people who are out of work and want to go back to school have to give up their monthly unemployment check. And if they decide to return to school, they often don't qualify for federal grants because eligibility is based upon the previous year's income.In addition to making it easier for those out of work to return for additional training, President Obama has been pushing for a transformation of the federal loan program to save taxpayers money and ensure stability for students. This USA Today editorial explains why this reform is important.
The student lending market is far smaller than the housing market. But it raises a similar question: Does it make sense for the government to pump its education dollars through banks — which divert some of the money for their own profits, wine and dine college financial aid officers to get on "preferred lender" lists, and lobby Washington to keep the spigot open?
The administration estimates it can save as much as $94 billion over 10 years by eliminating middlemen and lending directly. Even if that number is exaggerated, it reflects how inefficiently taxpayers' money is being spent. Banks shouldn't need major subsidies to issue guaranteed student loans.
While Brennan’s situation, and the remedy he is pursuing, may sound extremely ambitious, guidance counselors across the country say they can recall no prior year in which so many applicants’ families have been squeezed by so many financial pressures.President Obama has put forth a solid plan to make federal student loans more reliable, while saving taxpayers billions of dollars. To learn about the President's proposal, click here.
Not only have families’ incomes been falling as their savings have dwindled, but also tuition has been rising — including proposed increases of nearly 10 percent next year throughout the University of California system....Interest rates on student loans, including on popular federal programs like the unsubsidized Stafford (now nearly 7 percent) and Parent Plus (8.5 percent), are running several percentage points higher than the rates on secured loans, like home equity lines of credit.
“The difference of rates between secured and unsecured loans is higher than I have ever seen,” said Scott White, director of counseling services at Westfield High School in New Jersey. “This is one further impediment to access to post-secondary education for all but the well-to-do.”
This proposal would not threaten private lenders' ability to make private loans to college students at unregulated (and often highly profitable) interest rates. It would simply allow the federal government to keep the profits from loans it already subsidizes, instead of handing them over to banks. It would improve efficiency and save money, and it should have been passed a long time ago.
Private companies that reap undeserved profits from the federal student-loan program are gearing up to kill a White House plan that would get them off the dole and redirect the savings to federal scholarships for the needy. Instead of knuckling under to the powerful lending lobby, as it has so often done in the past, Congress needs to finally put the taxpayers’ interests first. That means embracing President Obama’s plan.
Under the College Cost Reduction and Access Act of 2007, two federal loan forgiveness programs could provide greater assistance to those who decide to pursue careers that serve the public. Income-Based Repayment (IBR) and Public Service Loan Forgiveness (PSLF) could make student loan forgiveness much more accessible to the masses.We encourage you to read the entire article to learn more about the two provisions, as well as visit the Department of Labor's website for the IBR and PSLF provisions.
"Both of these programs are much more widely available than anything that's been available in the past," says Irons.
The budget rightly calls for phasing out the wasteful and all-too-corruptible portion of the student program that relies on private lenders. And it calls for expanding the less-expensive and more-efficient program that allows students to borrow directly from the federal government. That means doing away with the Federal Family Education Loan Program, under which private lenders receive unnecessary subsidies to make risk-free student loans that are guaranteed by taxpayers.
WASHINGTON D.C. – U.S. Rep. George Miller (D-CA), the chairman of the House Education and Labor Committee, issued the following statement today after U.S. Treasury Secretary Henry Paulson announced a new plan to bolster consumer lending, including student loans. The plan would allow investors to obtain a loan from the Federal Reserve, using student-loan and other asset-backed securities as collateral, potentially providing more funding to lenders to extend consumer credit.
More students than ever before are receiving Pell Grants to help pay for college and that number is on the rise, according to a new report released today by the College Board. The study also shows that, with college costs rising, students are continuing to access the federal student loans for which they are eligible. Over the past year, the average tuition and fees for in-state students at four-year public colleges and universities increased by 6.4 percent to $6,585 for the 2008-2009 school year.