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What is the difference between FFELP (Federal Family Educational Loan Program) and Direct Lending (The William D. Ford Federal Direct Loan Program)?

April 26, 2017difference educational family Federal FFELP lending loan program william d. ford federal

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What is the difference between FFELP (Federal Family Educational Loan Program) and Direct Lending (The William D. Ford Federal Direct Loan Program)?

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In the Direct Loan Program, the U.S. Department of Education acts as a lender, providing funds for Stafford Loans and PLUS Loans. With FFELP, students chose a bank or lender; the college then certifies that students and parents are eligible for the loans and applies the loan proceeds to student accounts.