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Changes for Student Loans
By Jon Greenberg on Thursday, August 20, 2009.
A bill in Congress would increase direct government lending to students. Supporters say it would save consumers and the government a lot of money, but others worry cutting banks and non-profit groups out of the picture would leave students without essential services. We’ll look at how this and other issues could affect student lending in New Hampshire.
Guest
- June Schlabach, director of the financial aid office at Plymouth State University
- Rene Drouin, president and CEO of the New Hampshire Higher Education Assistance Foundation
- Kelly Field, chief Washington reporter for the Chronicle of Higher Education
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Due to the current job market I am returning to school to earn my master's degree in Sustainable and Environmental Management at Harvard's Extension School. Per Harvard's policies you must take three pre-req courses that are not eligible for federal aid, only private loans. The loans I looked at had variable rates from 2.5%-13%, adjustable every 3 months! And unlike federal loans, interest does accrue while I am in school! I have decided this is way too risky and decided to put my tuition on a credit card. This is quite different from my experience as an ungrad in the late 90's!
The panel for this topic appears bias. Each person represents the Federal Family Education Loan Program (private loan progrma subsidized by taxpayer dollars). Oddly, it was not discussed that Mr. Drouin's salary is paid through subsidies associated with the private loan program. The basis of the subsidies is to allow student loan agencies to make competitve low interest loans. I do not believe the subsidies are intended to pay excessive executive compensation. Based on NHHEAF's federal tax return, in 2008 Mr. Drouin's salary $550,072. I would expect NHPR to offer a more balance perspective of the student loan industry in the future. The elimination of the private loan program will allow subsidies currently use by NHHEAF and other like agencies who pay excessive salaries to be directed to the student; where it should be and not to line the pockets of agency executives.