Important Message From Financial Aid

3/12/2010 -

I hope this message reduces the confusion concerning the future of the student loan industry. I will outline the likely scenarios institutions could face on July 1, 2010.

The first scenario would be Congress passing the “Student Aid and Fiscal Responsibility Act of 2009” (SAFRA), or similar legislation that eliminates the Federal Family Education Loan Program (FFELP) that TCC is currently under. This will force all schools to transition to the Direct Loan Program. However, Congress faces some serious challenges to pass SAFRA. Democratic leaders are currently considering using the reconciliation process to pass healthcare reform. If this approach is used, Democrats have said that SAFRA will be combined with healthcare reform legislation to create one large reconciliation bill. It is unknown if democrats would be able to muster the 51 votes needed to pass a single reconciliation bill that would combine both healthcare and student aid reform.

The second possible scenario would be Congress not passing SAFRA, but extending the Ensuring Continuing Access to Student Loan Act (ECASLA). Under this scenario, the student loan business would continue as it is today. However, leading Democrats in the House and Senate have made it clear that they don’t plan to extend ECASLA past June 30, 2010.

The third possible scenario would be Congress not passing SAFRA or extending ECASLA. This scenario could cause some loan access issues if (FFELP) lenders are not able to raise sufficient capitol to meet the demand for FFELP loans and schools are not prepared to make loans through the Direct Loan program.

Given the uncertainty of future legislation, the Department of Education continues to advise schools that the best way to ensure students have access to loan funds is to be prepared to use the Direct Loan Program. TCC is currently using DL and has processed loans for many students whose lenders have stopped processing FFELP. I recently sent out an e-mail to students using Bank of America, notifying them of the fact that BOA is no longer processing loans as of December 15, 2009. Students whose lender is still in business have the option to continue using them, but keep in mind that if this law passes and you have to switch, it could delay your funds for Fall 2010.

Texas Chiropractic College and the Financial Aid Office are here to assist you and give you the most up to date information available. We will hold a question and answer session on this topic on a later date, until that time please check with our office for any questions and concerns.

Learn more about the Direct Loan Program

Best Regards,

Arthur Goudeau
Director of Financial Aid