President Obama's budget proposal asks Congress to:
- Eliminate those subsidies to other lenders.
- Increase the number of students who can borrow directly from the government.
- Take competitive bids for private contractors to service the loans.
- Use the subsidy savings to expand Pell grants to low-income students.
The article includes no student perspective, but does note that:
Some Kentucky universities have already started shifting their student loans to the Federal Direct Loan Program. The University of Louisville announced last month that starting this fall it would do so, citing the desire for a simplified process that would offer students a more stable and predictable funding source.To read more, check out the White House proposal here, and the C-J article here.
The University of Kentucky, Kentucky State University and Morehead State University also use the direct loan program.