Student loans get government aid - News
House of Representatives gave final approval of the "Ensuring Continued Access to Student Loans Act of 2008," President George W. Bush signed the bill into law.
With this bill signed into law, students and families now have every assurance that they will continue to have access to all the federal student loans they are eligible for, no matter what happens in the nation's financial markets," said Chairman of the House Committee on Education and Labor George Miller.
In the Committee's fact sheet on the bill, the bill is referred to as a contingency plan to ensure "continued, uninterrupted access to federal loans, regardless of what's happening in the credit markets," even though "no student or college has reported any problems accessing federal student aid to date." According to the Department of Education estimates, 40 to 60 percent of students who have not fully exhausted their eligibility for federal assistance take out private loans.
While federal aid might be currently accessible to students, private lending has become costly and less reliable as the U.S. With wary investors and scarce capital, many lenders struggled to fund their loans. Under this new bill, the U.S.
Secretary of Education Margaret Spelling, who only a year ago was criticized for not being strict enough and was described as "missing in action" after the corrupt practices were uncovered in the student loan industry, will be granted authority to advance federal funds to agencies acting as lenders of last resort and to purchase loans from lenders in the federal guaranteed loan program, thus, ensuring lenders' continued access to capital in order to originate new loans.
However, the purchase of such loans will only be authorized if there is no cost for the federal government. The Continued Access bill, which was initially approved in the House of Representatives by a vote of 383 to 27 on Thursday, April 17 and was passed on Thursday, May 1, will increase the annual loan limits and, thus, reduce borrowers' reliance on costlier private college loans. Continued..
Google Viewing Comments 1 - 1 of 1 Education Expert posted 5 12 08 10:51 AM EST Unfortunately, many kids will miss out on going to schools because of actions by the government.
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