"The Direct Lending program is going through an exciting period of growth, with over 400 schools new to Direct Lending in the 2008-2009 academic year, with hundreds more moving for 2009-10. Many different schools -- from big name public universities to small proprietary schools and everything in between -- have recognized that Direct Lending provides a stable funding source and streamlined and effective service to students, parents and schools," emphasizes Nancy Hoover, NDSLC Chair and Director of Financial Aid at Dennison University.
Schools that have transitioned to Direct Lending during the past two years report that the transition is easier than anticipated, with no additional costs to their budgets, does not require hiring more staff, and provides a simpler, faster, more efficient and reliable way for students to receive their federal student loan dollars. In fact, new schools report that the hiring of third party servicers or consultants to help with the transition is totally unnecessary.
Direct Loan schools report, and national statistics confirm, that the U.S. Department of Education provides superior service to students, families, and schools, and their "Late Stage Delinquency" default prevention program has resulted in a decrease in their cohort default rates. In fact, the cohort default rate in Direct Lending remains significantly lower than in FFELP.
For program transition purposes, to supplement the excellent work of the Department of Education's DL Transition team, the Coalition has developed a list of mentors which can be accessed from the NDSLC website at http://www.directstudentloancoalition.org/Direct_Loan_Tools/mentor.asp. Our volunteer mentors are practicing financial aid administrators from two-year, four-year, public and private institutions that offer certificate, undergraduate and graduate programs. The Direct Loan schools on the mentor list serve enrollments varying from a few hundred students to 51,000.
The NDSLC encourages colleagues to contact individuals on the list to discuss implementation strategies or issues and best practices. The list includes financial aid administrators from every type of higher education institution using many different platforms (Financier, EDExpess, BANNER, SAMS, Jenzebar, Powerfaids, etc.) to provide specific advice for an institution's unique situation.
The NDSLC has also released "Direct Lending: Separating Myth from Reality," a publication intended to dispel the myths about Direct Loans that often circulate among those not familiar with this federal loan delivery system. To help schools separate myths from facts, the NDSLC document highlights the ease of administering the Direct Loan program by providing current, real-time testimonials from financial aid professionals who are both recent and long-term participants in the program. The brochure is available on line at the NDSLC web site: http://directstudentloancoalition.org/media/documents_autogen/myths.pdf.
The National Direct Student Loan Coalition (www.directstudentloancoalition.org) is the only organization solely devoted to representing the interests and concerns of direct lending institutions around the country. Our members are financial aid professionals from participating institutions. The mission of the National Direct Student Loan Coalition is to promote the success of the Federal Direct Loan Program in serving the interests of students, families, taxpayers, and institutions.
Posted 08/10/09 to www.NASFAA.org. Posting of press releases is done as a service to Members and does not imply endorsement or support by NASFAA. NASFAA does not review this information for content or accuracy.
