Will current economic woes affect my student loan?
The Oncoming Student Loan Crisis
Does the Current Credit Crisis Affect Student Loans?
How Does the Plight of Student Lenders Affect My Existing Loans?
Rising Tuition Costs and Your Student Loans
Should I Let My Student Loans Go to Collection?
Student Loan Lenders Dropping Like Flies
Have you been hearing about all the hoopla surrounding a possible student loan crisis and lack of financial aid for the next school year? It seems that a student loan crisis is a very real possibility in the United States and it could affect thousands, if not millions, of students. Dozens of lenders have already dropped out federal student loan programs, borrows are facing much tougher standards in loan approval, and tuition continues to rise. Fortunately, the government is taking it upon its shoulders to remedy the situation. Recently, the Bush administration proposed that Congress authorizes it to buy billions of dollars in federal student loans to make sure students have access to financial aid. The government would then be able to provide lenders with the capital they need to make new loans. Although the government is ready to do what it takes to prevent a student loan crisis, officials admit that this is a situation that they’ve never dealt with before and have to learn as they go. Making things more difficult, no one really knows if the government’s assistance will even be needed considering that the real rush for student loans won’t begin for several months. Currently, financial aid offices at four year colleges have yet to run into any trouble approving students for loans, but commercial colleges are already warning students about possible lending limits. Besides the government buying loans, the Education Department is also working on a “lender of last resort” program, which would allow students to get aid through the non-profit companies or state agencies that guarantee federal loans for the government. One thing the government doesn’t appear to be considering is buying private student loans. Private student loans make up a much smaller share of the student loan market, but are still significant as students borrowed $17 billion from private lenders last year.
While the government seems to be doing everything in its power to avoid a student loan crisis from ever occurring, that doesn’t mean you can’t take measures to protect yourself. So what’s the first and easiest step to guaranteeing your student loan? Applying! Don’t wait till the last minute to put in your application, apply as early as possible and you’ll avoid the possible loan crisis. When you apply, ask for more money than you think you might need. College is an expensive endeavor and it’s hard to accurately estimate the amount of money you’ll need, so get more than enough now while the money is still available. Remember, it’s better to be safe than sorry when it comes to getting your student loans this year.
