ERIC Number: ED318339
Record Type: Non-Journal
Publication Date: 1990-Feb
Reference Count: N/A
The Stafford Student Loan Program. Testimony before the Subcommittee on Permanent Investigations, Committee on Governmental Affairs, United States Senate.
The Stafford Loan Program (formerly called the Guaranteed Student Loan Program) makes three kinds of student loans for postsecondary education: Stafford Loans, Supplemental Loans for Students (SLS), and Parents Loans for Undergraduate Students (PLUS). Stafford loans are low-interest loans based on financial need, while SLS and PLUS loans are not based on financial need. Each loan is insured by one of 55 state or nonprofit guaranty agencies. Guaranty agencies can collect an insurance premium on each loan; they reimburse lenders for 100% of defaulted claims; and they serve as lenders of last resort. The Department of Education administers the program; reinsures the guaranty agencies for 100% of defaulted loans, except in those cases where the agency's default rate exceeds 5%; and makes interest payments to lenders for Stafford loan borrowers while they are in school. Figures for growth in number of loans, increases in dollar amounts of loans, increases in number of defaults, increases in loans to students attending proprietary schools, and default rates of students attending proprietary schools are provided. The report also notes actions taken by the Congress and the Department of Education to reduce loan defaults, and lists 11 General Accounting Office reports concerning the program. (JDD)
Publication Type: Reports - Descriptive; Numerical/Quantitative Data
Education Level: N/A
Authoring Institution: General Accounting Office, Washington, DC. Div. of Human Resources.