ASU student loan defaults among lowest in nation

Once again, Athens State University students fare better than the national average on student loan repayments, according to recent U.S. Department of Education figures.

But according to Athens State University’s Director of Financial Aid Sarah McAbee, the default rate for Athens State’s graduates was even less than half of the nation’s low percentage at 2.5 percent.

“Our alumni historically seem to be good credit risks for these federal loans,” McAbee said. “An affordable tuition, the maturity of our students, and the university’s commitment to assure a manageable debt upon graduation are all strong factors in the low default rate. I am always impressed in the manner in which our former students have fulfilled their financial responsibilities.”

To decrease the amount of debt incurred by their graduates, Athens State’s Office of Financial Aid identifies federal, state, institutional and outside funding sources available to students, including both grant and loan programs.

In addition, Athens State awards approximately 60 scholarships annually with the Athens State University Foundation and the University’s Alumni Association providing more than 100 scholarships awarded each year.

State approves $100 million deal for college student loans

The state commission in charge of student loans approved a $100 million deal Friday to keep offering loans to students in Illinois.

The Illinois Student Assistance Commission met in Edwardsville and approved a unique arrangement with eight credit unions, including metro-east-based Scott Credit Union. The deal was brokered fairly quickly, with only six weeks from the beginning of talks to Friday's news conference.

Andy Davis, executive director of the commission, said he approached 12 major banks and at least half a dozen foreign banks to invest in student loans, but major lenders nationwide have bailed on student loans to shore up their financial walls during the subprime mortgage crisis. Some states, including Minnesota, Massachusetts and Pennsylvania, simply shut down student loan programs, though Massachusetts recently announced it would resume student loans after a mass bond sale.

The credit unions are a unique solution in the United States, Davis said.

College will be more affordable for thousands of Illinois students thanks to today's vote," said Donald McNeil, commission chairman. "This deal ensures that our college students will be protected from the credit crisis that paralyzed student lending in other states."

Student loans administered by states are guaranteed at 97 percent by the federal government. Illinois agreed to cover the remaining 3 percent for the credit unions, which has been approved by the Illinois Department of Professional and Financial Regulation.

Locally, 78 percent of students at Southern Illinois University and more than 90 percent of students at McKendree University rely on some form of financial aid.

Lynda Andre, assistant superintendent of Edwardsville District 7 and a commission member, said the deal will "protect Illinois students as consumers."

"By enabling students to borrow federally guaranteed loans instead of private loans, students get loans which are safer, more affordable and less-complicated," she said.

Canada student loans impoverish the future

There's something seriously wrong with a country that allows its future - its students - to begin their adult lives weighed down by a mortgage-like debt.

Earlier this year, I received a student loan balance update informing me that in my quest for higher education, I have so far accumulated $30,000 in debt to my province and country. Upon graduation, I will be expected to pay about $400 a month - a sum that has been set for me, regardless of my state of employment.

Graduates are rarely able to pay these loans back in a timely manner. They are often shackled with tens of thousands of dollars in debt up to 10 years after graduation, when many are also trying to build families and save for their futures.

The Canada Student Loans Program has been taking advantage of na've, newly graduated high-school students by allowing them to withdraw upwards of $10,000 a year, without any introduction to financial management or a promotion of alternatives.

A 2007 study conducted by the Coalition for Student Loan Fairness, a group that advocates Student Loans reform, states: "Even people with mortgages or car loans rarely encounter the problems that graduates experience with the administration of student loan debt."

This same study found that CSLP loans are financed at prime plus five per cent, translating to anywhere from 8.5 to 11 per cent interest rates. This is more than double what it costs the government to borrow the money. And struggling graduates are being forced to pay higher interest rates than they would on a new car or even their mortgage.

Meanwhile, CSLP is annually turning a profit on their debt repayment program. The federal government expected the program to produce a $550-million surplus in 2007.

A study conducted by Winston Jackson, a former professor at St. Francis Xavier University in Nova Scotia, said student loans were just the beginning of an individual's financial problems.

Jackson found that graduates who took out loans in university make nearly 20 per cent less in terms of annual income than those who went through school loan-free.

Unfortunately, many students feel that they have no other option but to take out loans.

While Canada Student Loans imagines itself as a saviour to those who could not otherwise afford an education, reality is it's a for-profit agency more than prepared to saddle those same young students with debts that will follow them long into their adult lives.

In an age when the value of post-secondary education is so high that you almost can't get a job without graduating university, the government must be taking steps to ensure that Canada's future generations aren't being forced to live under the poverty line because of their degrees. Education should be increasing potential, not holding people back.

Fitch to Rate Panhandle-Plains Higher Ed Trust I Student Loan

Fitch expects to rate Panhandle-Plains Higher Education Authority, Inc. Trust I Student Loan Revenue Bonds, senior series 2008A-1 as follows:

--$200,000,000 student loan revenue bonds, senior series 2008A-1 'AAA'.

For more information, see the Panhandle-Plains Higher Education Authority, Inc. Trust I Student Loan Revenue Bonds, Senior Series 2008A-1 presale report, available to all investors on Fitch's corporate site, www.fitchratings.com.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.