Plan Seeks to Expel Private Lenders From Program
In the latest in a string of government bailouts and takeovers the federal government is proposing to cut the private lenders out of the student loan business and become the direct supplier.
The WSJ reports:
Under a plan unveiled in the administration’s budget, subsidies to private lenders would be eliminated, and the government would use the savings estimated at $47.5 billion over the next decade to help bolster the Pell grant program for low-income students.
If approved by Congress, the plan would effectively end government-guaranteed loans to students by banks and other private lenders—lending that has totaled $56.7 billion in the current school year, and has been the primary source of college financial aid since the program was launched in the 1960s.
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