The Bush administration is preparing to buy up student loans, giving a boost to the struggling student loan market, including Reston-based Sallie Mae.
Buying up loans would help ensure that lenders have access to capital. The U.S. Department of Education announced yesterday it would implement a two-step program to stabilize the market.
The news followed Sallie Mae’s warning that there was a potential shortage of loans because of the subprime mortgage crisis.
The department’s plan includes buying unsecuritized debt for loans during the 2008-2009 academic year. The department will also buy into temporary trusts to provide more short-term liquidity for student lenders.
Congress passed legislation earlier this month directing the federal government to develop a plan to stabilize the student loan market.
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--student loan information of USA
Mar. 24, 2009 at 06:15 AM
For most post-secondary schools in the United States, federal student loans are a large portion of funding. New rules enacted last year set limits on the percentage of financial loans that can go into default. Several schools are considering rejecting federal loans all together, even though they are not hitting this limit.
--Federal Student Loans of Los Angeles, CA
Mar. 15, 2011 at 02:37 AM