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What is the difference between the Family Federal Education Loan Program (FFELP) and Direct Loans?

April 26, 2017difference Education family Federal FFELP loan Loans program

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What is the difference between the Family Federal Education Loan Program (FFELP) and Direct Loans?

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There are two different types of federal student loan providers. Direct Loans are issued by the federal government; FFELP loans are federally backed loans, but they are issued through a private bank. Both are mandated by federal guidelines in regards to interest rates and borrower rights. About 70% of colleges participate in FFELP, and some colleges participate in both programs.