Student Loan

Albert Lord doesn't like to wait - not in business or on the golf course. The colorful chairman of student loan behemoth Sallie Mae, who's embroiled in a nasty fight over the failed sale of the company, has spent 40 years in the accounting and banking industries. He said that experience should have instilled in him a measure of patience, but it hasn't. Whether in traffic, at the office or on the links, Lord said, he just doesn't like to wait. He can't do much about the first two, but he's got a sure-fire solution for the last one: He's building his own, an 18-hole golf course on land he's acquired amid shuttered tobacco farms and grazing horses in southern Anne Arundel County.

Kickbacks, conflicts of interest, multimillion-dollar out-of-court settlements, high-profile resignations and suspensions under a veil of shame - if only we could throw in an illicit affair. It's hard to believe we are talking about something as unsexy as student loans. Ninety percent of students who receive loans choose their lender based on their school's recommendation. In an age where students leave college with an average of more than $19,000 in loan debt, students should be able to count on their schools for impartial and helpful advice as they navigate a complicated and stressful process.

Congress stripped a major provision from recently passed student loan legislation that would have helped future graduates reduce their debt in exchange for commitments to lower-paying jobs in public service. The House of Representatives approved a maximum $5,000 in student loan forgiveness for graduates who choose careers in public health, public safety or foreign languages, such as working as a linguist at the Fort Meade-based National Security Agency. But last week, a conference committee cut the benefit.

The idea of politicians tinkering with billions of dollars in the student loan program can make anyone a bit wary. But this time they got it right, with students coming out the winner in legislation passed recently by Congress and to be signed by the president. The law will cut nearly $21 billion in government subsidies to lenders over the next five years. Almost all the money will be plowed back into grants for the poorest students, lower interest rates and loan forgiveness for those in careers that society values but nevertheless underpays.

WASHINGTON -- Remember the student loan you got for college years ago and never paid back? Maybe you were poor or unemployed or negligent. And maybe you thought the U.S. government had forgotten about you.No way.In every part of the nation, the Justice Department is pushing record numbers of deadbeat grads into federal courts in a last-ditch effort to collect on at least some of the billions of dollars in defaulted student loans, some of which originated in...

WASHINGTON -- As part of a passel of election-year programs intended to allay fears about the cost of college, the Clinton administration has proposed that banks accept slightly lower interest rates on student loans.Though the figures involved are relatively small -- a graduate paying off a $10,000 loan over 10 years would save $499 -- lenders are fiercely resisting the move. The industry contends that many banks would stop making college loans if Congress adopted the proposals."The administration's proposal would continue to drive lenders out of the student loan business," said Barbara Chiapella, a spokeswoman for the American Bankers Association.

WASHINGTON -- The Supreme Court made it easier yesterday for federal prosecutors to win criminal cases against colleges or trade schools that embezzle or steal government-guaranteed student loan funds.To gain a conviction on a charge that those funds have been appropriated for personal use, prosecutors need prove only that those involved knew they were misusing the money, the court ruled unanimously.There is no need for prosecutors to prove, in addition, that the defendants intended to defraud the government as the backer of student loans, the court said.

The president of the largest guarantor of student loans in the nation and Maryland has been placed on indefinite leave after the company's board was informed last weekend that he had been convicted of resisting arrest in January.On Monday, the Fishers, Ind.-based USA Group put Roy A. Nicholson on administrative leave, the Indianapolis Star reported Tuesday. He had been convicted of a misdemeanor stemming from a late-night altercation Nov. 22 with an Indianapolis police officer.USA Group officials would not speak for Nicholson, and he did not answer telephone calls to his home yesterday.

Maryland higher education officials have announced that they will be delayed three weeks in awarding college aid to state students, blaming delays by the federal government in processing financial aid applications.The Maryland State Scholarship Administration intended to mail letters this week to 60,000 state residents saying how much assistance they would receive for the academic year starting next fall. Instead, most students will not hear until the middle or end of this month.Linda Weippert, the agency's director, said the state will award about $39 million to 31,000 Maryland college students.

WASHINGTON -- Bowing to protests from the Clinton administration and Senate Democrats, the Senate Labor and Human Resources Committee abandoned a proposal yesterday that its critics said would have given away $1.8 billion in federal money to nonprofit student loan guaranty agencies.Republican Sen. Nancy Landon Kassebaum of Kansas, who heads the committee, insisted that she had never intended to give away the money. But she acknowledged that the language drafted by her staff was "subject to various interpretations, including some I do not share."

In an effort to head off a threatened crisis in student loan availability, the federal government will buy loans from lenders, double the amount of loans it writes directly and bolster a "lender of last resort" program that helps low-income students finance college. The moves announced yesterday are aimed at reassuring lenders that they will have ready access to cash throughout the 2008-2009 college year, at a time when the financial markets have gone moribund. "We want students to be able to concentrate on their studies rather than worry about disruptions in the student loan market and whether they will be able to obtain federal loans to help pay for school," Secretary of Education Margaret Spellings said in a statement.

If your federal student loan doesn't cover all your expenses and banks are making it harder to get private loans, who can you turn to? How about strangers? That's what some students are doing at peer-to-peer lending Web sites. These sites typically connect people needing money with dozens of regular folks willing to lend $50 or so at an agreed-upon interest rate. Usually borrowers at these sites seek several thousand dollars to pay off high-rate credit cards or for a business venture.

Albert Lord doesn't like to wait - not in business or on the golf course. The colorful chairman of student loan behemoth Sallie Mae, who's embroiled in a nasty fight over the failed sale of the company, has spent 40 years in the accounting and banking industries. He said that experience should have instilled in him a measure of patience, but it hasn't. Whether in traffic, at the office or on the links, Lord said, he just doesn't like to wait. He can't do much about the first two, but he's got a sure-fire solution for the last one: He's building his own, an 18-hole golf course on land he's acquired amid shuttered tobacco farms and grazing horses in southern Anne Arundel County.

College students from across the country are back in school. Many of them cannot afford the sky-high cost of college without loans. As a result, countless students are going to spend decades after they graduate paying off enormous debts to student loan companies. Just as the right degree presents a student with new opportunities, the wrong loan harmfully restricts where their education can take them. With the stakes so high, we need to make sure every student can easily choose the loan that is right for him or her, and is protected by his or her school and the government from unfair lending deals.

The idea of politicians tinkering with billions of dollars in the student loan program can make anyone a bit wary. But this time they got it right, with students coming out the winner in legislation passed recently by Congress and to be signed by the president. The law will cut nearly $21 billion in government subsidies to lenders over the next five years. Almost all the money will be plowed back into grants for the poorest students, lower interest rates and loan forgiveness for those in careers that society values but nevertheless underpays.

Congress stripped a major provision from recently passed student loan legislation that would have helped future graduates reduce their debt in exchange for commitments to lower-paying jobs in public service. The House of Representatives approved a maximum $5,000 in student loan forgiveness for graduates who choose careers in public health, public safety or foreign languages, such as working as a linguist at the Fort Meade-based National Security Agency. But last week, a conference committee cut the benefit.

Recently, lawmakers and the media have focused on potentially improper relationships between student financial aid administrators and certain lenders, even going so far as to propose eliminating the position in college student aid offices. These proposed measures could have harmful, unintended consequences for students and parents attempting to finance higher learning. Without an objective third party, consumers would be more prone to manipulation by direct-to-consumer marketing by unscrupulous lenders.

Americans love to shop. After all, we made The Price is Right the longest running TV game show. But when it comes to shopping for student loans - a complex product with hundreds of lenders to choose from - we'd rather have someone else do the legwork. Now, we've learned, that can be a problem. Colleges for years have compiled lists of recommended lenders to help families navigate through a maze of options. An investigation by the New York attorney general's office, though, uncovered chummy financial relationships between some financial aid officers and lenders promoted on the school's list.

The Johns Hopkins University has agreed to pay more than $1 million to settle a threatened lawsuit by New York Attorney General Andrew M. Cuomo, the latest in a string of victories for the crusading lawyer whose student-loan investigation has led to dismissals of top officials at Hopkins and other colleges nationally. Hopkins has also agreed to five years of monitoring of its financial aid practices - the first such oversight arrangement Cuomo has struck with a school outside his state.

When Polonius in Shakespeare's play Hamlet said, "Neither a borrower nor a lender be," he was a fortunate man. He did not have a student loan, revolving credit debt, a car loan, a home equity loan or a mortgage. In today's society, young people are weaned early on credit dependency: Credit-card issuers can snare them before high school graduation, stepping up pressure at college orientation. Issuers bet mom and dad will step in with the cash if the student falls too far in the hole. Too often parents and children view approval of a college loan with the same gusto as a college scholarship or money saved for college.