UP student loan changes
UP will switch from private lenders to lending from the federal government
Sydney Syverson
Issue date: 11/19/09 Section: News
The University of Portland will switch to a system of loans next year in which students will borrow directly from the federal government versus borrowing from a private lender.
According to a letter that will be sent to all University of Portland students and parents in December, Director of Financial Aid Janet Turner explains that UP will switch from the Federal Family Education Loan Program to the William D. Ford Federal Direct Loan Program beginning next school year.
The letter states that the Secretary of Education, Arne Duncan, is urging all colleges and universities to change from the FFELP to the Direct Loan Program.
"Honestly, I don't think many students know much about the entire loan process, except that it's pretty confusing," Junior Jeni Mussio said. "From what I know about these two loans it doesn't seem like the change is going to affect the students that much."
The letter from Turner explains what this means to students and parents.
All borrowers will have to eSign a Federal Direct Loan Promissory Note as well as complete Federal Direct Loan Entrance Counseling.
Three types of loans will be available to students and parents.
The Direct Subsidized and Direct Unsubsidized Loans are the two appropriate for students.
The Direct Subsidized Loan is for students who qualify for financial need and no interest is charged while enrolled in school.
The Direct Unsubsidized Loan is not based on financial need and interest is charged while enrolled in school.
The Direct PLUS Loan is meant for parents of dependent students and for graduate or professional degree students.
Interest is charged for these loans while the student is enrolled in school.
Students may wonder what will happen to their existing loans that they borrowed from private lenders.
Turner explains that when students graduate, they can either make payments to both their private lenders and to the US Department of Education, or they can decide to consolidate their loans into one payment that goes to either the private lender or to the US Department of Education.
According to a letter that will be sent to all University of Portland students and parents in December, Director of Financial Aid Janet Turner explains that UP will switch from the Federal Family Education Loan Program to the William D. Ford Federal Direct Loan Program beginning next school year.
The letter states that the Secretary of Education, Arne Duncan, is urging all colleges and universities to change from the FFELP to the Direct Loan Program.
"Honestly, I don't think many students know much about the entire loan process, except that it's pretty confusing," Junior Jeni Mussio said. "From what I know about these two loans it doesn't seem like the change is going to affect the students that much."
The letter from Turner explains what this means to students and parents.
All borrowers will have to eSign a Federal Direct Loan Promissory Note as well as complete Federal Direct Loan Entrance Counseling.
Three types of loans will be available to students and parents.
The Direct Subsidized and Direct Unsubsidized Loans are the two appropriate for students.
The Direct Subsidized Loan is for students who qualify for financial need and no interest is charged while enrolled in school.
The Direct Unsubsidized Loan is not based on financial need and interest is charged while enrolled in school.
The Direct PLUS Loan is meant for parents of dependent students and for graduate or professional degree students.
Interest is charged for these loans while the student is enrolled in school.
Students may wonder what will happen to their existing loans that they borrowed from private lenders.
Turner explains that when students graduate, they can either make payments to both their private lenders and to the US Department of Education, or they can decide to consolidate their loans into one payment that goes to either the private lender or to the US Department of Education.
Be the first to comment on this story