How big is the SAL loan market in the overall federal student loan market?
According to the US Department of Education, in 2007 for profit commercial, nonprofit and public agency lenders participating in FFEL will make about $52.4 billion in new and the federal government will make about $13.6 billion under the Direct Student Loan Program. Of that amount SAL loans only account for $1.5 billion of the $66 billion in new federal student loans. While this represents a small slice of the overall federal loan market, it offers huge benefit to students struggling to pay tuition in graduate or professional school. Why would Congress want to destroy a valuable program? • How would private lenders benefit if schools were kicked out of the program? Kicking schools lenders out of the FFEL would give private lenders unfettered ability to make FFEL loans to graduate and professional students at these institutions. Graduate and professional loans are coveted by private lenders because of their low default rates and high balances. These private lenders have already begun ag
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