Direct Lending Could Overtake Bank-Based Student-Loan Programs Next Year (The Chronicle of Higher Education)
"This year's growth in the Education Department's direct-lending system could be replicated in 2009, possibly leaving the now-dominant bank-based system as the minority supplier of federal student-loan money by next fall, according to findings from a new survey of colleges," The Chronicle of Higher Education reports. "The Web-based poll of 416 college financial-aid directors last week by Student Lending Analytics found that 6 percent of those currently using the bank-based system plan to switch to direct lending next academic year, and 29 percent are considering making that change. At the same time, the Education Department on Monday issued new statistical data detailing an increase in direct lending this year. Larry Zaglaniczny, vice president for governmental affairs at the National Association of Student Financial Aid Administrators, agreed that colleges will continue to flock to the direct-lending system if the Bush administration doesn't quickly come through with additional aid for private student lenders."
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