“This legislation provides students and families with the single largest investment in federal student aid ever,” said Representative George Miller, Democrat of California and chairman of the House Education and Labor Committee, who wrote the bill. “Today, the House made a clear choice to stop funneling vital taxpayer dollars through boardrooms and start sending them directly to dorm rooms.”
Under the current program, the government pays subsidies to lenders and guarantees the loans. All colleges would be required to convert to the federal Direct Loan program by July 1, 2010.
The measure passed handily in the House; looks like it will breeze through the Senate also. Finally some measure of sanity prevails, if only for a moment.
It sounds like good news, but I'm unclear about the process. Unless Stafford loans will be run through a Federal program rather than the banks. It has always irked me that there is an "origination fee" on a student load. A college education is already absurdly expensive.
ReplyDeleteThat's my take on it, that the loan will now be directly from the Feds. I believe it was this way in the 70s?
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