Student loans Banned from the Garden!--very long

The Stafford Loan program is administered in two different ways. The
institution can elect to be a "Direct Lending" school in which case the
loan funds are sent by the government directly (electronically) to the
school. Banks, per se, are not involved. Other schools follow the
older method where the student applies via the FAFSA to determine the
amount and type of eligibility and then must go find a participating
bank in order to receive the funds. Direct lending became an option to
schools in the reauthorization of 1992. The state universities in Iowa
are direct lending schools. The state universities in Michigan (based
on conversations with FA administrators from MI) are not direct lenders
because the banks lobbied hard so they could keep their fingers in the
loan pie. I know Iowa State became direct lending because under the old
method the loan office staff had to interpret the lending documents of
approximately 400 different banks in any given year just for the
Stafford Loans. Funds arrived from each bank whenever they got
there--can take a long time for a student who chooses to get a loan from
his hometown bank in Alaska. Direct lending has more reporting
requirements, but it is still far simpler (all electronic, same format
for everyone, submitted in one batch instead of piecemeal) and speedier
(funds arrive three days after the date the school declares the student
eligible).

Within either direct or indirect Stafford loans are the subtypes of
"Subsidized" and "Unsubsidized". The government pays the interest on
the subsidized loans while the student is still in school. Students
must either pay the interest on an unsubsidized loan while in school or
capitalize it and have a larger balance due at graduation. Eligibility
for subsidized loans is based on "financial need" as determined by the
FAFSA. There is also a strict cap on total amount of subsidized loans a
student may have, both annually and over the entire degree program.
Students must make satisfactory academic progress in order to receive
aid from any of the federal programs mentioned here.

Pell Grants used to be a blessing to very low income families. Unlike
the price of tuition, the annual amount for a Pell Grant did not
increase for *many* years. It has only been recently (2000?) that the
government started indexing the amount based on inflation rates.

Some other federal programs a Perkins Loans (a rather small pot of
money given to the school and the school determines which of the
neediest students get it--usually first come first served; the school
acts as the collection servicing agent after the student graduates),
Federal Work-Study (government funds pay a certain percent--usually
60-75%--of the eligible student's wages for an campus job or community
service job), PLUS Loans (loans in the name of the student's
parent--repayment begins six months after disbursement, interest rates
are higher than on loans made in the student's name), Health Professions
Loans (specifically for students in medicine, nursing, vet med, or other
professional medical programs), Federal Supplemental Education
Opportunity Grant (a very small pot of money given to the
school--handled the same way as Perkins Loans). There are also
federally funded research grants which are not handled through the
financial aid office.

Now that everyone is asleep...

Dr. Brat wrote:
Mmmmm, I don't think so, Dianne. To my knowledge so called Stafford
loans are money from banks on which the government pays the interest
while the student is in school. So the interest is paid for by the
neighbors, but the loan itself is not. Pell grants, on the other hand,
are paid for by your neighbors. And of course, all this says nothing
about how it actually works in Canada.

--
Brenda Lewis
WIP: J. Himsworth "I Shall Not Want" xs
J & P Coats "Dancing Snoopy" latchhook

Ok. A friend of mine has returned to school (at the age of 48), and
I'll have to ask her where her loan originated. I know she's getting a
Pell grant, but other funds are "loans". I thought this was all
tax-payer funded. My husband went to school on Pell and other
government loans that "didn't" have to be paid back (GI Bill). But that
was eons ago.

Anything the "government" does, whether it's interest or actual up-front
dollars, is paid for by your neighbors. g Whether or not you pay it
back.

Dianne

Dr. Brat wrote:

Mmmmm, I don't think so, Dianne. To my knowledge so called Stafford
loans are money from banks on which the government pays the interest
while the student is in school. So the interest is paid for by the
neighbors, but the loan itself is not. Pell grants, on the other hand,
are paid for by your neighbors. And of course, all this says nothing
about how it actually works in Canada.

Elizabeth

Actually Michigan State is in the Direct Lending program and has been
since 1995 as my husband got a direct loan his last year as an
undergraduate.

Suzanne

The Stafford Loan program is administered in two different ways.
The institution can elect to be a "Direct Lending" school in
which case the loan funds are sent by the government directly
(electronically) to the school. Banks, per se, are not
involved. Other schools follow the older method where the
student applies via the FAFSA to determine the amount and type
of eligibility and then must go find a participating bank in
order to receive the funds. Direct lending became an option to
schools in the reauthorization of 1992. The state universities
in Iowa are direct lending schools. The state universities in
Michigan (based on conversations with FA administrators from MI)
are not direct lenders because the banks lobbied hard so they
could keep their fingers in the loan pie.

On 7/22/03 2:13 AM,"Brenda Lewis" posted:

The Stafford Loan program is administered in two different ways. The
institution can elect to be a "Direct Lending" school in which case the
loan funds are sent by the government directly (electronically) to the
school. Banks, per se, are not involved. Other schools follow the
older method where the student applies via the FAFSA to determine the
*snipped*

Thanks so much, Brenda. That was very informative. It's a maze. I was lucky
with my GSLs - so long ago. But, mine were actually administered by some
company in FL that ended up getting fired by Sallie Mae, because the company
was incompetent, and put thousands of us into DEFAULT even though we
weren't. What a mess. There was a class action lawsuit, IIRC, in FL - though
I no longer lived there. At the time, I worked for the Federal Government,
had paid mine down to about $6 K, and had a security clearance. After months
of dealing with the new loan administrator - in Minnesota - who didn't care
because they hadn't made the mistakes - my job, my security clearances were
all in jeopardy. Despite my many cancelled checks, statements, and the
articles about the bad company having screwed up - so I had to just pay mine
off early. Big lump payment for someone who'd only been out of grad school
less than 10 years.

I know things have changes. Financial aid here is an amazingly complicated
thing. I couldn't believe my Dniece got a full tuition scholarship - based
strictly on academics, etc - when my DB has a high 6 figure income. I was
embarassed that they didn't turn it back - I told him they should at least
make an equivalent charity donation to the school for some needy student. We
had friends who turned in their daughter's swimming scholarship - as they
really didn¹t need it at all.My DB said that since it was academic, it
wouldn't go to someone else, so....

Thanks again for the good, clear information.
ellice

Ellice wrote:

Dianne, think of it as a good investment in bettering society. We all are
supposed to reap benefits from helping our neighbors. This is something that
helps lift people. And is really necessary.

The high cost of education isn't because professors are getting wealthy -
it's all the supplies, equipment, resources, infrastructure needed. But, if
we don't educate people, and provide a means for those who wish to go
further, then we don't better ourselves. Okay, enough pollyanna-ism from
me.


I said in an earlier post on the subject that I thought it was
"necessary" and the right thing to do. grin What I don't believe in
is that every single person needs a college education for a good,
well-educated job. That is currently the culture war we are fighting.
What I DO believe in is a more rounded, intense education during K-12.
What I ALSO believe in is more mentoring at the high school level, and
more vocational areas to follow. Not everyone wants to be a rocket
scientist, and some technical skills require a good deal of education.

Focus on general math in ways that students can use the skills in
everyday life; focus on reading (good literature, good vocabularies),
focus on grammar. Make history meaningful, not dry. Make students
understand government, both at the state and federal level. Give them
some geography mixed with social sciences. Leave the "how to budget" to
mom and dad. Leave the sports to private enterprise. I would prefer to
borrow from some of the European ways. Not in total, just juggle it
around so we have a better system here.
Dianne

Work study money is also counted as tax-free income; I got a complete
refund when I included a note saying that all my income that year was
work-study.

Meredith

Brenda Lewis wrote:

The Stafford Loan program is administered in two different ways. The
institution can elect to be a "Direct Lending" school in which case the
loan funds are sent by the government directly (electronically) to the
school. Banks, per se, are not involved. Other schools follow the
older method where the student applies via the FAFSA to determine the
amount and type of eligibility and then must go find a participating
bank in order to receive the funds. Direct lending became an option to
schools in the reauthorization of 1992. The state universities in Iowa
are direct lending schools. The state universities in Michigan (based
on conversations with FA administrators from MI) are not direct lenders
because the banks lobbied hard so they could keep their fingers in the
loan pie. I know Iowa State became direct lending because under the old
method the loan office staff had to interpret the lending documents of
approximately 400 different banks in any given year just for the
Stafford Loans. Funds arrived from each bank whenever they got
there--can take a long time for a student who chooses to get a loan from
his hometown bank in Alaska. Direct lending has more reporting
requirements, but it is still far simpler (all electronic, same format
for everyone, submitted in one batch instead of piecemeal) and speedier
(funds arrive three days after the date the school declares the student
eligible).

Within either direct or indirect Stafford loans are the subtypes of
"Subsidized" and "Unsubsidized". The government pays the interest on
the subsidized loans while the student is still in school. Students
must either pay the interest on an unsubsidized loan while in school or
capitalize it and have a larger balance due at graduation. Eligibility
for subsidized loans is based on "financial need" as determined by the
FAFSA. There is also a strict cap on total amount of subsidized loans a
student may have, both annually and over the entire degree program.
Students must make satisfactory academic progress in order to receive
aid from any of the federal programs mentioned here.

Pell Grants used to be a blessing to very low income families. Unlike
the price of tuition, the annual amount for a Pell Grant did not
increase for *many* years. It has only been recently (2000?) that the
government started indexing the amount based on inflation rates.

Some other federal programs a Perkins Loans (a rather small pot of
money given to the school and the school determines which of the
neediest students get it--usually first come first served; the school
acts as the collection servicing agent after the student graduates),
Federal Work-Study (government funds pay a certain percent--usually
60-75%--of the eligible student's wages for an campus job or community
service job), PLUS Loans (loans in the name of the student's
parent--repayment begins six months after disbursement, interest rates
are higher than on loans made in the student's name), Health Professions
Loans (specifically for students in medicine, nursing, vet med, or other
professional medical programs), Federal Supplemental Education
Opportunity Grant (a very small pot of money given to the
school--handled the same way as Perkins Loans). There are also
federally funded research grants which are not handled through the
financial aid office.

Now that everyone is asleep...

Dr. Brat wrote:
Mmmmm, I don't think so, Dianne. To my knowledge so called Stafford
loans are money from banks on which the government pays the interest
while the student is in school. So the interest is paid for by the
neighbors, but the loan itself is not. Pell grants, on the other hand,
are paid for by your neighbors. And of course, all this says nothing
about how it actually works in Canada.

--
Brenda Lewis
WIP: J. Himsworth "I Shall Not Want" xs
J & P Coats "Dancing Snoopy" latchhook

Dianne Lewandowski wrote:
Ellice wrote:

Dianne, think of it as a good investment in bettering society. We all are
supposed to reap benefits from helping our neighbors. This is
something that
helps lift people. And is really necessary.

The high cost of education isn't because professors are getting wealthy -
it's all the supplies, equipment, resources, infrastructure needed.
But, if
we don't educate people, and provide a means for those who wish to go
further, then we don't better ourselves. Okay, enough pollyanna-ism from
me.



I said in an earlier post on the subject that I thought it was
"necessary" and the right thing to do. grin What I don't believe in
is that every single person needs a college education for a good,
well-educated job. That is currently the culture war we are fighting.
What I DO believe in is a more rounded, intense education during K-12.
What I ALSO believe in is more mentoring at the high school level, and
more vocational areas to follow. Not everyone wants to be a rocket
scientist, and some technical skills require a good deal of education.

In the U.S. only about 31% of the population gets any sort of training
after high school (the figure is from the U.S. census bureau).

Focus on general math in ways that students can use the skills in
everyday life; focus on reading (good literature, good vocabularies),
focus on grammar. Make history meaningful, not dry. Make students
understand government, both at the state and federal level. Give them
some geography mixed with social sciences. Leave the "how to budget" to
mom and dad. Leave the sports to private enterprise. I would prefer to
borrow from some of the European ways. Not in total, just juggle it
around so we have a better system here.

If you are suggesting that Europeans leave sports out of their
education, I'd have to say that you are wrong. I had physical education
three times a week in Belgium, including swimming and plenty of chance
to play intermural sports (volleyball at lunch!). There certainly
isn't, however, IME, the cult of competition that exists here.

Elizabeth
--
*~*~*~*~*~*~*~*~*~*~living well is the best revenge~*~*~*~*~*~*~*~*~*
The most important thing one woman can do for another is to illuminate
and expand her sense of actual possibilities. --Adrienne Rich
*~*~*~*~*~*~*~*~*~*~*~*barnacle-encrusted bitch~*~*~*~*~*~*~*~*~*~*~*

Dr. Brat wrote:

In the U.S. only about 31% of the population gets any sort of training
after high school (the figure is from the U.S. census bureau).

Yes, and the rest of them are working at Wal-Marts. I realize I'm being
sarcastic and overly simplistic. But the jobs that we used to have,
that would provide very adequate incomes for families, are dropping like
flies. Also, some jobs that require a 2-year degree, are now requiring
a 4-year degree. Not because the education is any better, but because
those with a 4-year degree had their own organization, got miffed at
their college loans pay-off and time spent in college, and changed the
rules.

The chance of anyone climbing up the corporate ladder without a higher
degree is about zilch. Teachers, to be well-paid, require Masters.
They can't spell any better, but they have to have that extra M after
their title. (I realize I'm over generalizing, but from what I've
personally seen in about 8 different school systems, I'm appalled.)

If you are suggesting that Europeans leave sports out of their
education, I'd have to say that you are wrong. I had physical education
three times a week in Belgium,

I have "heard" stories about foreign school systems, and I had an
Italian "exchange" student for one year. So much of what she said made
sense. There were no sports. There are a "few" flaws that I could see
happening in their system, but basically, it sounded a lot better than
ours in U.S. Also had the German system explained to me, but that was
from 1940's, so maybe not done anymore. It was similar to the Italian
system.

I made a sweeping statement when I said "Europeans". Wrong of me.
Darn, you're always right on top of this stuff. Can't get anything by
you. g

Dianne

Dianne Lewandowski wrote:
Dr. Brat wrote:
In the U.S. only about 31% of the population gets any sort of training
after high school (the figure is from the U.S. census bureau).

Yes, and the rest of them are working at Wal-Marts. I realize I'm being
sarcastic and overly simplistic. But the jobs that we used to have,
that would provide very adequate incomes for families, are dropping like
flies. Also, some jobs that require a 2-year degree, are now requiring
a 4-year degree. Not because the education is any better, but because
those with a 4-year degree had their own organization, got miffed at
their college loans pay-off and time spent in college, and changed the
rules.

And yet, more people in the US have college degrees than ever before...

[snippety doo da]


I made a sweeping statement when I said "Europeans". Wrong of me. Darn,
you're always right on top of this stuff. Can't get anything by you. g

Doncha just hate people like that? *grin*

Elizabeth
--
*~*~*~*~*~*~*~*~*~*~living well is the best revenge~*~*~*~*~*~*~*~*~*
The most important thing one woman can do for another is to illuminate
and expand her sense of actual possibilities. --Adrienne Rich
*~*~*~*~*~*~*~*~*~*~*~*barnacle-encrusted bitch~*~*~*~*~*~*~*~*~*~*~*

Ellice wrote:
Thanks so much, Brenda. That was very informative. It's a maze. I was lucky
with my GSLs - so long ago. But, mine were actually administered by some
company in FL that ended up getting fired by Sallie Mae, because the company
was incompetent, and put thousands of us into DEFAULT even though we
weren't. What a mess. There was a class action lawsuit, IIRC, in FL - though
I no longer lived there. At the time, I worked for the Federal Government,
had paid mine down to about $6 K, and had a security clearance. After months
of dealing with the new loan administrator - in Minnesota - who didn't care
because they hadn't made the mistakes - my job, my security clearances were
all in jeopardy. Despite my many cancelled checks, statements, and the
articles about the bad company having screwed up - so I had to just pay mine
off early. Big lump payment for someone who'd only been out of grad school
less than 10 years.

OUCH! I know there have been many abuses over the years, but this is
one of the worst I've heard about. Glad you managed to pull through!

I know things have changes. Financial aid here is an amazingly complicated
thing. I couldn't believe my Dniece got a full tuition scholarship - based
strictly on academics, etc - when my DB has a high 6 figure income. I was
embarassed that they didn't turn it back - I told him they should at least
make an equivalent charity donation to the school for some needy student. We
had friends who turned in their daughter's swimming scholarship - as they
really didn¹t need it at all.My DB said that since it was academic, it
wouldn't go to someone else, so....

I've dealt with a few families in similar situations. I ask if they
donate medals and certificates of achievement to charity or return them
to the presenter or the award. They always say, "Of course not!" Then
I explain that a scholarship based on merit (especially one requiring no
application) is just like getting a non-financial award. It is a
recognition of excellence and should be accepted graciously. If they
wish to make an equivalent charity donation, they may do so but are
under no obligation. Being admitted with full academic scholarship is
also an accomplishment which can be listed, along with honor society
memberships and the like, on her first resume or grad school application.

--
Brenda Lewis
WIP: J. Himsworth "I Shall Not Want" xs
J & P Coats "Dancing Snoopy" latchhook