Student Loan Availability Unchanged at ASU
March 25, 2010
“Loans will still be available to meet the needs of all qualifying ASU students,” said Steven D. Klein, associate vice president for enrollment management at Angelo State. “Any student that needs a loan at ASU and qualifies for that loan will still have access to loan monies.”
The amounts of the loans will not be affected either. Students will qualify for the same amount of assistance whether a bank or the government makes the loan.
What will change is the source of the loans from the banking industry to direct loans from the federal government through the U.S. Department of Education. The only question is whether the federal government will require that change to begin this July or in July of 2011.
Although that change could be delayed until next year, Klein said ASU will begin to implement direct lending through the Department of Education starting this July. Rather than sign a promissory note with an approved bank, ASU students will now sign a promissory note with the Department of Education.
“Because we are going to have to convert to direct lending by next year at the latest,” Klein said, “we have decided to start that process now. We think it will avoid confusion in the long run and will make it easier on our students to adjust to the new procedures.”
The change will affect students currently enrolled at ASU with loans secured through banks. In the past these students have had to sign a promissory note with one of seven banks approved through ASU. Starting in the summer for any future loans, students will need to sign a new promissory note with the Department of Education.
For entering ASU freshmen, the loan process will be seamless as they will start with a direct loan from the Department of Education.
“I want to reiterate that loan funds will be available for all qualifying students,” Klein said. “Some of the processes will change slightly, but we will do everything we can to smooth the transition for our current students and acquaint them with the new procedures.”