WE ARE OPPOSED TO THE NEW STUDENT LOAN LEGISLATION AND YOU SHOULD BE TOO!

The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

The American Council on Education held its 89th annual meeting on Sunday, Feb. 11, 2007 and focuses on “The Access Imperative.”

The council found that the main reason that low-income students did not have the same access to universities as middle-income students was due to a lack of preparedness and social and cultural barriers. These are issues that need to be dealt with in K-12, before students are getting ready to enter college, and it is counter-intuitive to think that interest rate cutes (especially ones that help so few students) will help low-income students get to college easier!

Consumer Guide Also Hurt Low-Income Families
The council also discovered that because some colleges place such a high priority on ranking in consumer publications such as U.S. News & World Report that they limit access to low-income students because they are allowing these guides to set the criteria of “top school” not true education initiatives.

Check out this quote from an article written by Richard Byrne from “The Chronicle of Higher Education:”

Some of the practical fallout of the pursuit of prestige has been reflected in a lessening of flagship universities’ commitment to low-income and minority students, said Kati Haycock, director of the Education Trust. Her group, an independent research and advocacy organization, released a report in late 2006 that ranked top state universities’ commitment to such access issues and found many of them wanting (The Chronicle, November 21, 2006). Those rankings suggest that ‘most flagship universities have walked away from low-income kids and kids of color,’ Ms. Haycock said on Sunday.

New Student Loan Legislation Does Not Solve Low-Income Students’ Problems
The proposed student loan legislation sounds great but it doe not address the socio-political issues surround access to college for low-income students. In fact, this bill will most likely make it HARDER for MIDDLE CLASS students to access college as well, because the will loose thousands of dollars in student loan incentives, with what is essentially a Student Loan Tax. Also, FFELP Lenders work with students and families to resolve credit issues to ensure that they can get much needed Stafford and PLUS loans.

The College Student Relief Act of 2007 is a sound-bite that doesn’t increase access to college for low-income families and it sure DOES cost taxpayers, especially students.

PROTECT STUDENT LOANS and YOUR FREEDOM OF CHOICE!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THE NEW STUDENT LOAN LEGISLATION AND YOU SHOULD BE TOO!

The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

Robert Novak wrote this article, “Student Loan Scam” which I found on the Real Clear Politics website. In it, he quotes Rep. Tom Price (R-GA) commenting on the Student Relief Act:

“‘If only this bill did what they say,’ Price declared.” Check out the article for more information. The politicians would have us believe that the rate reduction and savings are immediate, with Federal Subsidized loans reduced from 6.8% to 3.4%. But the truth is altogether different. Here are the facts on rates for Federal Subsidized loans.

2007-2008: ACTUAL RATE IS ONLY 6.12%
2008-2009: ACTUAL RATE IS ONLY 5.44%
2009-2010: ACTUAL RATE IS ONLY 4.76%
2010-2011: ACTUAL RATE IS ONLY 4.08%
2011-2012: ACTUAL RATE IS FINALLY 3.40%
2012-2013: Rate goes back to 6.80%

Little Known Facts Paint Discouraging Picture:

• Borrowers believe the rate will be 3.4% on all Federal Subsidized loans, starting in 2007 and ending in 2012.
• The new bill doesn’t cut the rates in half to 3.4% for 5 years; it does so for one only: 2011-2012.
• Borrowers believe they will save thousands each year for the next six years.
• Borrowers will actually save incrementally over time, until 2011-2012 where they will save the full 3.4%.
• Borrowers believe that all students who have Federal Subsidized loans are eligible for the discount.
• Only 29 percent of borrowers are eligible. That leaves over 70 percent of college students left out in the cold, who benefit nothing.

The proposed student legislation hurts students. So, take action today to stop it before it’s approved by the US Senate.

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THE NEW STUDENT LOAN LEGISLATION AND YOU SHOULD BE TOO!

The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

If the new student loan legislation becomes law, it will:

1. double the fees for students who consolidate their loans, adding to student loan debt.
2. eliminate up to 2.25% in interest rate reductions for borrowers.
3. cause students to forfeit thousands of dollars in savings over loan term.
4. no longer allow borrowers to choose their Federal Family Education Loan Program (FFELP) lender, forcing them to go with the Federal Direct Lending Program (FDLP).

FDLP: A Bankrupt Solution

Truthfully, the switch from the FFELP to the FDLP would end up costing us big time, in the long-run. However, the short-term implications of making the switch are scary at best.

Here are the facts:

• The FDLP owes the government $105 billion but only has $89 billion in loans. That’s a $16 billion deficit.
• The FDLP hasn’t saved a dime since 1997, instead running a deficit each year for almost 10 years. (Remember, this is the program that will SAVE us money, somehow).
• The FDLP has been BANKRUPT since 1997. If run like a “real business,” it wouldn’t even exist today.
• The FFELP has been successfully serving and benefiting borrowers for 40 years. Since the FFELP isn’t government-run, it is efficient and hasn’t had a single deficit year.

You help us defeat the new student loan legislation.

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO H.R. 5 AND YOU SHOULD BE TOO!

The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

Recently the College Student Relief Act (HR5) was passed by the House of Reps. The SRA is the bill that pledges to reduce interest rates on some loans from 6.8% to 3.4%, promising to cut college costs and expand access to college.

Sounds Good, But Is It Really?

“It’s an incredibly expensive proposal with very little student aid benefit.”

This, from Mark Kantrowitz, the publisher of FinAid.org.

Here are some other things this respected industry leader says about H.R. 5:

• “The benefit, Mr. Kantrowitz notes, comes after students have graduated…”

• “Even though the lower interest rates could add up to more than $4,000 over the lifetime of a typical graduate’s loan, that would mean monthly payments only dropped by about $30.”

Here’s what others who are “in the know” are saying about H.R. 5:

• “‘cutting rates would do little to reduce their college expenses.’ He called the idea of reducing interest rates ‘frivolous’ and said it creates nothing more than a ‘headline sensation.’”– SLM Corp’s CEO, Tom Fitzpatrick

• “That’s because the legislation won’t really cut student loan interest rates; it will cut the portion paid by graduates.” – Leslie Carbone in Jan. 23, 2007 edition of the Baltimore Sun

• “It is unclear whether such a burden on taxpayers would help make college more affordable. It might do exactly the opposite: make higher education more expensive.”– Republican Rep. Jeff Flake of Arizona

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO H.R. 5 AND YOU SHOULD BE TOO!
The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

Someone better keep their eyes on our public servants (politicians) before things get out of hand. President Bush went on record back in February saying that he was trying to “right-size” the student loan industry.

What the media conveniently forgot to tell you was that the new legislation:

• that will slash lender subsidies would drive many companies out of business.
• eliminating private lenders will have an adverse affect upon students.
• giving the government more control over student loans would create a bloated bureaucracy
• would actually costs the taxpayers more money by reducing competition among lenders

Despite the plethora of promises from politicians and the media coverage that has been painting a positive picture if such bills as H.R. 5 is passed, the future of education in the United States is headed for disaster.

Here’s Why:

• HR5 steals a college education from the neediest students
• HR5 eliminates students’ freedom of choice in selecting the lender that best meets their needs
• HR5 creates a monopoly on student loans enslaving students to the direct loan program
• HR5 robs students from savings realized by consolidating loans
• HR5 tax breaks are a complete rip off—benefits don’t happen for a year and only save a few dollars each month

Act now–before it’s too late!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO H.R. 5 AND YOU SHOULD BE TOO!
The government is taking money out of YOUR POCKET, AGAIN.

Call and E-mail Your Senator and Sign Our Petition.

Outright Deception?

Politicians are parading the benefits of the new student loan legislation while hiding its true features. Case in point is the Student Relief Act that was just passed by the House.

• Students were told they would have interest rates cut from 6.8% to 3.4%.
• Borrowers would save approximately $4,300 over the course of several years.
• The truth is that the 3.4% rate only applies for one year: 2011-2012.
• Purported savings of $4300 is nowhere near the real figure, as that amount was based upon a 3.4% rate from 2007-2012.
• This representation is not only blatantly false, but perhaps an outright attempt to mislead the public.

Prophecies Becoming Reality?

In a recent article I read college officials expressed their concern, “worried that the plan might end up helping even fewer students” than originally intended.

Unfortunately, this may soon become reality.

Hopefully, though, more and more people are starting to realize the smoke and mirrors machinations of our politicians as well as the potential outright deception that has been foistered upon us by our public servants (read politicians).

The real question may be, how much longer are we going to put up with it? Let’s just hope that this “short-term” snag doesn’t become a long-term pattern…

Take Action Now!

Call and E-mail Your Senator and Sign Our Petition.

Although it seems that few are keeping score and even fewer NOT buying into the political propaganda put out by Washington these days, the United States is in the midst of an education crisis, with no real solution in sight.

New Legislation Does Nothing to Rectify The Problem!

Many college students and their parents had put much faith in the new federal legislation, loaded with promises of increasing access to college and cutting costs. But bills such as H.R. 5 leave much to be desired and in fact will worsen the education crisis, if it becomes law.

Here’s what you’ll lose if the new student loan legislation passes:

1. Your right to the best service in the industry. Since all lenders will be forced to compete for a smaller share of the market at a higher cost, lenders can no longer afford to offer the outstanding service they used to.
2. Your right to choose your own lender. If H.R. 5 becomes law, you will no longer have the ability to select the lender of your own choosing. You will be forced to go with the Federal Direct Lending Program (FDLP).
3. Your right to discounts and incentives. Say goodbye to interest rate discounts up to 2.25%. With the FDLP you’re stuck with a measely .025% discount, but only if you use your debit card for payment.
4. Your right to savings. With the disappearance of up to 2.25% in interest rate discounts goes hundreds of dollars in savings yearly and thousands over the course of the loan.

WE ARE OPPOSED TO THIS STUDENT LOAN TAX AND YOU SHOULD BE TOO!

The government is taking money out of your pocket again!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THIS STUDENT LOAN TAX AND YOU SHOULD BE TOO!

The government is taking money out of your pocket again!

Call and E-mail Your Senator and Sign Our Petition.

Industries and individuals across the nation are waiting to see just what the effects of the new Democratic student loan legislation such as H.R. 5, the STAR Act and the Sunshine Act will bring.

Here’s a Quick Overview:

• Students were told they would have interest rates cut from 6.8% to 3.4%.
• Borrowers would save approximately $4,300 over the course of several years.
• The truth is that the 3.4% rate only applies for one year: 2011-2012.
• Purported savings of $4300 is nowhere near the real figure, as that amount was based upon a 3.4% rate from 2007-2012.
• This representation is not only blatantly false, but perhaps an outright attempt to mislead the public.

What to Do? Fight for Your Rights While You Still Can

1. Students have the right to the best service in the industry. Since all lenders will be forced to compete for a smaller share of the market at a higher cost, lenders will no longer be able to offer the same outstanding service they used to and students lose.
2. Students have the right to choose their own lender. If H.R. 5 becomes law, you will no longer have the ability to select the lender of your own choosing. You will be forced to go with the Federal Direct Lending Program (FDLP).
3. Students have the right to discounts and incentives. Say goodbye to interest rate discounts up to 2.25%. With the FDLP you’re stuck with a measly .025% discount, but only if you use your debit card for payment.
4. Students have the right to savings. With the disappearance of up to 2.25% in interest rate discounts goes hundreds of dollars in savings yearly and thousands over the course of the loan.

TAKE ACTION BEFORE IT’S TOO LATE!

Call and E-mail Your Senator and Sign Our Petition.

At first glance, it would seem that students win when lenders/banks complete. But, don’t be deceived.

When it comes to recent student loan legislation like H.R. 5, Sunshine Act and the STAR Act, YOU (THE STUDENT/BORROWER) LOSE WHEN BANKS COMPETE.

Here’s Why:

1. All lenders will be forced to compete for a smaller share of the market that will cost them more and result in less profits.
2. The Result: lenders can no longer afford to offer the outstanding service you’re used to.
3. Borrowers will be forced to use the Federal Direct Lending Program, whose only discount is a .025% interest rate reduction for payments via debit card.
4. The Result: borrowers will no longer have access to up to 2.25% worth of interest rate discounts formerly available to them.
5. Borrowers will no longer have the ability to choose their lender.
6. The Result: by being forced to use the Federal Direct Lending Program, borrowers will lose thousands of dollars in savings over the course of their loan, forfeiting their right to save.

You Lose When Banks Compete

You, the college student or you, mom or dad borrower lose—it’s that simple. If the STAR Act and the Sunshine Act become law, the student loan landscape will be adversely altered beyond recognition.

What’s At Stake:

• An estimated $1 billion in yearly savings from lost incentives and benefits, such as discounts for on-time payments from lenders.
• FREE services: portfolio debt management, default avoidance, loan forgiveness programs and college financial planning tools.
• The ability to choose lenders. If the government gets their way, you will be forced to use a Federal Direct Lender. Keep in mind this program has serviced only 20% of the student loan market, and has been painfully unsuccessful in so doing, running a $16 billion dollar deficit, to date.
• The belief that college access and rising costs are being addressed. (They are not).

Call and E-mail Your Senator and Sign Our Petition.

The Pell pill. Now that the dust has settled, it’s a lot harder to swallow.

The Pell Grant award:

• had not been increased in more than five years until recently.
• has remained at a maximum value of $4,050 for all that time.
• covers only 33 of the average cost of attending a public, four-year institution.
• increased to 6 percent or $260 for the 2007-2008 school year.
• was funded from the elimination of the Supplemental Educational Opportunity Grants Program (SEOG), and steep cuts to the Perkins Program.

What’s It Costing Us?
The increase is of course welcome, but the real question is, what’s it going to cost college students in the long run?

Speculation ended recently when we found out to our horror that the Pell increase would come at the expense of the outright elimination of the Supplemental Educational Opportunity Grants Program (SEOG), and steep cuts to the Perkins Program. All this for a paltry $260 increase. Was it worth it? I think not.

Who’s Fooling Who? Summary & Implications of New Legislation

1. So, the high profile Pell Grant gets its much-lauded increase, yet two key programs that have served lower-income students for years get the boot.
2. This “zero sum gain” seems indicative of the democratic educational reform platform. New legislation that makes huge promises but is of little real value, and may even do more harm than good.
3. The implication that the student loan legislation (H.R. 5, the Sunshine Act and STAR Act) is more of the same, of questionable value at best and outright deception at worst.
4. Unfortunately, most students have little motivation to search out the truth regarding student loan legislation. They would rather believe the propaganda of the popular media, and happen upon the truth when it’s too late and they can’t do anything about it (after the bills become law).

It’s not too late to stop the Student Loan Tax.

Call and E-mail Your Senator and Sign Our Petition.

Here’s what you’ll lose if the new Student Loan legislation passes:

1. Your right to the best service in the industry. Since all lenders will be forced to compete for a smaller share of the market at a higher cost, lenders can no longer afford to offer the outstanding service they used to.
2. Your right to choose your own lender. If H.R. 5 becomes law, you will no longer have the ability to select the lender of your own choosing. You will be forced to go with the Federal Direct Lending Program (FDLP).
3. Your right to discounts and incentives. Say goodbye to interest rate discounts up to 2.25%. With the FDLP you’re stuck with a measly .025% discount, but only if you use your debit card for payment.
4. Your right to savings. With the disappearance of up to 2.25% in interest rate discounts goes hundreds of dollars in savings yearly and thousands over the course of the loan.

With this and other recent legislation just waiting to become law, to students’ detriment, politicians are basically promising FREE money to college students. Here’s a quote from one of our public servants:

“10 billion dollars in scholarships, grants and fellowships that would not cost taxpayers a dime.”

That’s the line that borrowers are being pitched to sell the new STAR Act, that switches colleges from the FFELP (Federal Family Education Loan Program) to the FDLP (Federal Direct Lending Program).

The only problem is that:

• Its not true: the scholarships, grants and fellowships are not FREE.
• These items will be paid for by you, the borrower.
• The FDLP is bankrupt and has been insolvent for 10 years, currently operating at a $16 billion deficit.
• It makes absolutely no sense to ‘save money’ with a program that has been losing it for almost 10 years.
• Lost savings to borrowers represent over a billion dollars a year collectively, and thousands for individual borrowers over the term of their loans.

Take action NOW! Stop the Student Loan Tax!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THIS STUDENT LOAN TAX AND YOU SHOULD BE TOO!

The government is taking money out of your pocket again!

Call and E-mail Your Senator and Sign Our Petition.

In an attempt not to be outshone when it comes to middle-class issues, the Republicans have rallied behind higher education initiatives, going head-to-head with democrats on the legislative front.

Who Wins, Who Loses in Politics over Policy With the new Student Loan Legislation?

• When both parties are competing to “one-up” each other when it comes to financial aid reform, the “real work” is not getting done.
• Legislation is created that gives the public THE PERCEPTION that something is being done, when it is anemic at best and doesn’t accomplish what claimants say it does at worst.
• The bottom line is that there is a true gap in the funding of higher education in the United States, one that is making access to college difficult for low-income students and burdening many students with major financial debt.

Here Are the Facts:

1. 80% of America’s colleges and universities chose to work with FFELP because it delivers better service and more choices to their students than the Direct Loan Program.

2. This plan DOES NOT help students go to college, NOT ONE additional student will be able to attend college because of this act.

3. Lending Companies give students interest rate reductions -the Direct Loan Program DOES NOT.

4. On January 2, 2012, the interest rate returns back to 6.8 percent, making the promised $4,400 in savings is IMPOSSIBLE TO ACHIEVE.

5. There in NO GUARANTEE that subsidies that HR 5 proposes to stop paying FEELP Loan providers will go back to support scholarships and education.

ACT NOW to stop this legislation from becoming law!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THIS STUDENT LOAN TAX AND YOU SHOULD BE TOO!

The government is taking money out of your pocket again!

Call and E-mail Your Senator and Sign Our Petition.

Does anyone really like to settle for their second or third choice for anything? Though leftovers aren’t half bad, most college students given the option would probably prefer a fresh meal at a nice restaurant.

The same applies to the new college student aid legislation that may soon become law, leaving a bad taste in the mouths of borrowers across the country, if it does.

In their original forms, the laws weren’t half bad. However, students shouldn’t have to settle when it comes to financing their college education. Yet, that is exactly what will be happening if H.R. 5 gets pushed through.

If Student Loan Legislation becomes law:

1. Instead of being able to choose your own Federal Family Education Loan Program (FFELP) lender, you will have to settle for using the Federal Direct Lending Program (FDLP).
2. Instead of receiving outstanding customer service and benefits from the FFELP with a 40-year track record of excellence, you will have to settle for the bankrupt FDLP which has little to offer other than a 10 year history of deficits.
3. Instead of saving thousands of dollars over the history of your loan with the FFELP, you will have to settle for forfeiting these savings with the FDLP.
4. Instead of receiving up to 2.25% interest rate reductions, you will have to settle for a .025% reduction but only if you pay via debit card.

ACT NOW to stop this tax!

Call and E-mail Your Senator and Sign Our Petition.

WE ARE OPPOSED TO THIS STUDENT LOAN TAX AND YOU SHOULD BE TOO!

The government is taking money out of your pocket again!

Call and E-mail Your Senator and Sign Our Petition.

Government Undersecretary Tucker recently stated that “U.S. banks are harming the ability of college students to afford school by milking profits from the federally funded system.”

But is that really what’s going on? Who’s fooling who? (I’ll let you decide. Hint: it’s not the lenders).

Politicians are basically promising FREE money to college students:

“10 billion dollars in scholarships, grants and fellowships that would not cost taxpayers a dime.”

That’s the line that borrowers are being pitched to sell the new STAR Act, that switches colleges from the FFELP (Federal Family Education Loan Program) to the FDLP (Federal Direct Lending Program).

The only problem is that:

• Its not true: the scholarships, grants and fellowships are not FREE.
• These items will be paid for by you, the borrower.
• The FDLP is bankrupt and has been insolvent for 10 years, currently operating at a $16 billion deficit.
• It makes absolutely no sense to ‘save money’ with a program that has been losing it for almost 10 years.
• Lenders will lose their right to compete for your business, including best rates and service.
• Borrowers lose their right to CHOOSE their FFELP lender, and are forced to go with the FDLP.
• Borrowers forfeit their right to SAVE, since they will no longer have access to 2.25% in interest rate reductions from incentives.
• Savings lost represents over a billion dollars a year collectively, and thousands for borrowers over the term of their loans.

So, with the STAR Act, borrowers forfeit the right to save in exchange for unproven “savings” in the bankrupt FDLP program. What kind of sense does that make? Do the politicians really think they’re fooling anyone?

ACT NOW!

Call and E-mail Your Senator and Sign Our Petition.

If H.R. Bill #5 becomes law it will COST students and taxpayers thousands of dollars by imposing a STUDENT LOAN TAX on all federally funded student loans.

The government proposes to DOUBLE the fees it charges Federal Family Education Loan Program (FFELP) Lenders to provide student loans, forcing them to give up the discounts they currently offer that save students thousands of dollars over the life of their student loans.

The purpose of this increase is to raise revenue for the government, which makes it a direct tax on lenders and is therefore a tax on students. No one, not even the supporters of the bill, suggest that increasing the fees will reduce college costs. The objective is to tap the private lenders for additional revenue, and secondarily, to get more students to consolidate their loans through the direct lending program.

You’ll Pay More with Direct Lending
The Direct Loan Program DOES NOT offer benefits in the form of interest rate reductions to borrowers.

80% of America’s colleges and universities chose to work with FFELP because it delivers better service and more choices to their students. The Direct Lending Program has borrowed $105 billion, but only has $89 billion in performing loans to meet its obligations to the U.S. Treasury.

The Direct Lending Program has lost taxpayers money every year since 1997, totaling $16 billion.

Student Loan Scam
This bill is a political gimmick that is nothing more than a “good sound-bite.” It promises to save students money but DOES NOT deliver on that promise. The 3.4 percent interest rate stays in effect ONLY from July 1, 2011 through January 1, 2012. On January 2, 2012, the interest rate returns back to 6.8 percent, making the promised $4,400 in savings impossible to achieve.

What the public is likely to hear about HR5 and its companion bills are the clauses that reduce the interest rates on subsidized student loans. However, students don’t make interest payments on the subsidized portions of their loans, so the proposed reductions won’t inure to their benefit.

The “College Student Relief Act” DOES NOT provide relief to students. This plan DOES NOT help students go to college, NOT ONE additional student will be able to attend college because of this act.

Call Your Senator, Sign Our Petition
We are opposed to H.R. #5 and you should be too! This bill was recently passed by the U.S. House of Representatives and the Senate is set to vote on H.R. Bill #5 over the next couple of weeks. Help save student loan benefits and STOP the STUDENT LOAN TAX, you can make a difference by calling your senator, emailing your senator, signing our petition and sharing our petition with a friend. Help spread the word and STOP THE STUDENT LOAN TAX.