NU switches to federal loans only
University adopts Dept. of Ed. program
Sam Clarke
Issue date: 3/27/08 Section: News
In the midst of a growing sense of national economic uncertainty, student payment for higher education is not going unaffected.
Northeastern University officals announced last week that it is adopting a federal-loan-only program and rejecting private, third-party lenders in its financial aid packages.
Beginning in the fall, the university will participate in the William D. Ford Federal Direct Loan Program, which is funded entirely by the United States Department of Education.
The switch was made to keep student loans as stable and affordable as possible in a time when third-party lenders, like Sallie Mae, are tightening eligibility requirements and increasing interest rates.
According to the private loan portion of Columbia University's Web site, requirements include a U.S. credit record with no bankruptcies and no refunds owed on an education grant or loan.
Sallie Mae spokeswoman Beth Guerard said Emerson would not have the option to follow in Northeastern's footsteps because the college does not offer these types of private loans as part of its financial aid package.
The change will not prevent Northeastern students from taking a third-party loan independently, however.
Jenny Eriksen, media relations specialist at Northeastern, said that the measure will only stop students from securing private loans through the university.
"If Northeastern gives you loans and other financial aid and the student still needs more to pay off his or her education, then they can certainly take out another loan," she said.
Emerson College Financial Services provides a list of its most popular alternative loans on its Web site, including the Sallie Mae Signature Loan and CitiAssist Loan.
However, the office is forthright about the potential of such loans to harm one's credit report if payments cannot be made.
"While we understand that many students must take some of the responsibility to borrow for a private college education, we want students to consider only borrowing what they absolutely need," it says on the Web site.
Northeastern University officals announced last week that it is adopting a federal-loan-only program and rejecting private, third-party lenders in its financial aid packages.
Beginning in the fall, the university will participate in the William D. Ford Federal Direct Loan Program, which is funded entirely by the United States Department of Education.
The switch was made to keep student loans as stable and affordable as possible in a time when third-party lenders, like Sallie Mae, are tightening eligibility requirements and increasing interest rates.
According to the private loan portion of Columbia University's Web site, requirements include a U.S. credit record with no bankruptcies and no refunds owed on an education grant or loan.
Sallie Mae spokeswoman Beth Guerard said Emerson would not have the option to follow in Northeastern's footsteps because the college does not offer these types of private loans as part of its financial aid package.
The change will not prevent Northeastern students from taking a third-party loan independently, however.
Jenny Eriksen, media relations specialist at Northeastern, said that the measure will only stop students from securing private loans through the university.
"If Northeastern gives you loans and other financial aid and the student still needs more to pay off his or her education, then they can certainly take out another loan," she said.
Emerson College Financial Services provides a list of its most popular alternative loans on its Web site, including the Sallie Mae Signature Loan and CitiAssist Loan.
However, the office is forthright about the potential of such loans to harm one's credit report if payments cannot be made.
"While we understand that many students must take some of the responsibility to borrow for a private college education, we want students to consider only borrowing what they absolutely need," it says on the Web site.
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