The University of Nevada, Las Vegas has been selected to participate in the Federal Direct Student Loan Program beginning in the 1995-96 academic year, U.S. Secretary of Education Richard W. Riley announced recently.
UNLV is one of 983 schools announced by Riley. They are among the first to participate in a new streamlined system to restructure the nation's student loan programs.
"These schools will have an opportunity to demonstrate that direct lending can indeed simplify the administrative tasks of educational institutions, lower costs to taxpayers, and most importantly, provide better services to students," said Riley.
Under the new program, the federal government provides loans directly to students through schools. By eliminating the middlemen -- guaranty agencies, secondary markets, banks, and other private lenders -- direct lending eliminates excess profits, while reducing administrative burdens and increasing efficiency to make borrowing easier for students.
By taking advantage of the federal government's ability to borrow money at a lower interest rate, direct lending will save taxpayers billions of dollars. The new program also offers students a repayment option that tailors monthly payments to the borrower's income.
President Clinton's direct lending proposal, the Student Loan Reform Act of 1993, was passed with bipartisan support by Congress as part of the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66).
