S. Institution out of Degree would offer federal loans right to people using their universities
Whenever i arrive at The new America inside 2007, the fresh new student loan industry's dominance of the government student loan program looked impenetrable. It can be difficult to accept that today, given that the us government can make most of the government fund, but observe how long we have been in the last years, it is worthwhile to help you revisit this new immediate past.
During the time, financial institutions or any other private getting-finances and nonprofit lenders generated the majority of government loans so you're able to people and you will middlemen also known as guarantee businesses, and this covered financial obligation on behalf of the government. The federal government paid back big premiums to the organizations to join on the system and you will basically shielded all of their losses when borrowers defaulted in these finance.