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Change in US loan process will affect Loyola student loan recipients

Loyola press release - April 12, 2010

Changes to the way federal student loans are administered will affect every federal student loan recipient in the country who is continuing studies at a university or college, according to Cathy Simoneaux, director of the Loyola University New Orleans Office of Scholarships and Financial Aid.

On March 25, the U.S. House of Representatives passed the Health Care and Education Affordability Reconciliation Act of 2010 (H.R. 4872) which eliminates private lenders' administering of federal student loans on June 30, and mandates that all U.S. government-funded student loans will originate in the Federal Direct Loan Program.

Graduate and undergraduate students who wish to continue receiving federal loans, such as the Stafford and Grad PLUS loans, need to fill out the Direct Loan Entrance Counseling module and the Master Promissory note at www.studentloans.gov by July 31. This date is the priority application deadline for Loyola students to ensure funds will be distributed to the university in time for fall www.studentloans.gov registration.

The Office of Scholarships and Financial Aid has begun to notify Loyola loan recipients by letter and posted a helpful page on its Web site to further explain the changes to the program. Additional information will be sent to parents of undergraduate students who have utilized the Grad PLUS loan program later this month on the new updated application process available to them.

Simoneaux said the process is essential and will simplify the borrowing process for students and parents.

"This process is a good thing. Now there will be one process for all U.S. government loans, not different rules for different lenders," Simoneaux said. "Plus, the studentloans.gov Web site is easy to navigate and very user friendly."

For more information on changes to the Federal Direct Loan Program or to interview Simoneaux, contact Catherine Koppel in the Office of Public Affairs at 504-861-5448 or ckoppel@loyno.edu.