A recent analysis of data from the Department of Education's Data Center by Student Lending Analytics (SLA) shows that the portion of federal loans made in the Direct Loan Program increased to 42 percent in the quarter ending on Sept. 30 2009, up from 29 percent in the same quarter of 2008. The portion of loans made in the FFEL Program dropped to 58 percent in the quarter ending on Sept. 30 2009, down from 71 percent in the same quarter of 2008. The SLA analysis also found:

• Overall, federal loan disbursements (Stafford, PLUS, Grad PLUS) rose only 1.6% compared to the same quarter a year ago. Remember that it was in July of 2008 that loan limits on unsubsidized Stafford loans were increased.

• In terms of loan volumes disbursed, Direct Lending saw a 47% increase while FFEL disbursements fell by 17%. Citibank's Student Loan Corporation noted in their recent earnings release that their FFEL loan volume had fallen by 10% due to "schools moving from the FFEL Program to the Department of Education`s Direct Lending Program." In an SLA survey completed in July, 56% of respondents had indicated that they would remain in FFELP for 2009-10.

• Analyzing each of the loan programs separately shows the most significant growth in the GradPLUS program, which saw a 20% increase on a year-over-year basis (loan disbursements in millions of dollars):

You can read the complete Oct. 21, 2009 Student Lending Analytics article on-line.

Media Coverage

Direct-Loan Program Gains Bigger Share of Federal Student Lending The Chronicle of Higher Education

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