NASFAA Goes After Origination Fees on Federal Student Loans

"At Capitol Hill in Washington, student loan origination fees received some heat from critics who argued they were 'burdensome' and represented a tax on students," according to The Student Loan Report. "The critics, a team from the National Association of Student Financial Aid Administrators (NASFAA), attempted to lobby Washington lawmakers to end origination fees during a meeting with members of the House Committee on Education and the Workforce."

"Origination fees are often seen as a large burden to a student loan applicant. They are viewed as a remnant of the stake that private banks and lenders had in the student loan industry before the federal government took over. However, these origination fees are still charged by the Federal government.

Origination fees simply detract from the usefulness of a federal student loan from the student’s perspective. A recipient would only receive part of the loan after the origination fee, but he or she would still need to pay the full principal balance along with interest.

The National Association of Student Financial Aid Administrators (NASFAA) is an advocate for students, and this latest advocacy effort is part of the Advocacy Pipeline that NASFAA has created to bring policy makers and elected members together with on the grounded perspectives from student leaders. This initiative is just beginning, but so far, the NASFAA members have worked hard to establish direct advocacy options for student leaders."

NASFAA's "Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.

 

Publication Date: 12/6/2017

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