Supporters of the new direct student loan program are critical of the private loan-guarantee agencies that cover lender losses on defaulted loans, portraying them as greedy, inefficient, and plagued by conflicts of interest. In turn, the agencies and banks doubt federal capacity to manage student borrowing. (MSE)

Colleges and universities are finding that improvements in the guaranteed student loan process are making it more attractive than direct lending. In its third year, the direct lending program's total loan volume remains at 33%, well below the 50% goal set in originating legislation. Even some of its strongest supporters fear the program will have…

Researchers, economists, and campus administrators who have followed federal student aid programs worry that businesses have turned the Guaranteed Student Loan Program into a lucrative industry that doesn't always have the students' interest in mind, and a congressional study group is also concerned about aspects of the program. (MSE)

The Hong Kong system of student loans for higher education has worked efficiently since 1969. Many factors in its success are location-specific, but other governments may both learn from and contribute to the Hong Kong experience. (MSE)

A study at California State University, Fresno investigated the relationship between Perkins' Loan recipients' (n=429) credit records, loan default rates, and age. For eight different age groups, credit checks revealed student distribution in four credit categories. Results show credit checks could have saved the program a great deal of money.…

This article summarizes the current pattern of finance of higher education in Ghana, gives a brief history of student loans in Ghana, and describes a new program, which is administered by the Social Security and National Insurance Trust and is expected to result in a higher rate of loan repayment. (Author/DB)

Two years into its new life as a private company, the Student Loan Marketing Association (Sallie Mae) is both creating a division to handle the processing and clerical duties of college financial aid offices and backing away from a short-lived move into the business of underwriting college bonds. The agency also originates government-subsidized…

This introductory article describes current research on student loans in developing countries and concludes that student loans in these countries are feasible, can promote wider cost sharing, and can help to generate additional resources for higher education but only if loan programs are well designed and efficiently managed. (Author/DB)

The University of Oregon's financial aid director describes the success of the Federal Direct Student Loan program in its first year at the institution. No significant program disadvantages were experienced, and its advantages included flexibility of administration, ease of data management with the servicer, decrease in office workload, and…

A study investigated the implementation costs of direct lending in 77 diverse colleges and universities, including both increases and decreases in institutional expenditures. Results indicate that start-up costs varied greatly, that the institution's loan volume was related to the cost and savings experienced, and that costs and savings were…

A discussion of the problem of student loan defaults places the issue in the context of loan program history and current federal policy. It argues that the situation is more complex than some public officials admit, and that short-term solutions will not effectively address the long-term problem. (MSE)

Pennsylvania's sophisticated system for student loan fraud and abuse detection is described, including the factors felt to contribute to its success and suggestions for improving other state agency fraud units. (MSE)

A New York University study compared effects of the Direct Student Loan and Federal Family Education Loan programs on students, families, and campus administrators and of the programs' best practices. Some administrative challenges with dual program participation were found. Reactions to the programs were largely similar and positive, but…

Three plans for reforming the financing of students wishing to attend college, therefore improving college affordability, are outlined: (1) improving the college loan system; (2) mitigating high tuition with high student aid; and (3) making comprehensive changes at all levels of the college finance system (the Plan of the National Commission on…

Reviews problems with the Stafford Student Loan Program (Federal Family Educational Loan Program), including high-risk borrowers, dishonest school officials, negligent lenders, and guaranty agencies. Critiques recent reform measures designed to simplify the program. Suggests alternative policies, particularly direct loans from the federal…