Introduced by Rep. George Miller, Chairman of the House Education and Labor Committee, the legislation provides assurance that all eligible students at all schools will continue to receive the loans they need for college through 2010.
The “Ensuring Continued Access to Student Loans Act of 2008,” provided the Department of Education the authority to implement a solution to the unprecedented credit crunch in the student loan capital markets. The legislation also included several beneficial provisions for students and families including permanently increasing annual unsubsidized loan limits for all undergraduates and increasing flexibility for PLUS Loan borrowers.
Millions of students had already benefited from the “Ensuring Continued Access to Student Loans Act of 2008” but the law was set to expire on September 30, 2009. With the credit markets still disrupted, Congress recognized that current and future students could suffer if the legislation wasn’t extended through at least next academic year. The House of Representatives acted quickly and decisively passing an extension by a nearly unanimous vote (368 to 4). The Senate followed suit passing the legislation by unanimous consent. The bill now heads to the President for signature.
Members from both sides of aisle voiced support for an extension:
"At a time when our rough economy is already dealing a huge blow to American families, we can't allow trouble in the credit markets to further price students out of a college degree.
“With market turbulence showing no signs of letting up, it's only prudent to make sure that students have every assurance that the federal student loans they need will be there next year."
—Rep. George Miller (D-CA), chairman of the House Education and Labor Committee
“We are all united in our commitment to provide every assurance to students and families that there will be no disruption in the Federal student loans program regardless of what is happening in the financial markets.”
—Rep. Ruben Hinojosa (D-TX), member of the House Education and Labor Committee
“This extension signals our unwavering support for the Nation's largest source of financial aid, the Federal Family Education Loan Program. It is a crucial step that will help protect students and families and restore market confidence.”
—Rep. Robert Bishop (R-UT), member of the House Education and Labor Committee
The financial aid community, including a number of higher education institutions as well as National Association of Financial Aid Administrators (NASFAA) and the National Association of Independent Colleges and Universities (NAICU) also supported an extension of the “Ensuring Continued Access to Student Loans Act of 2008”:
“Extending the Department’s authority to purchase FFEL loans through July 1, 2010, ensures certainty in a vital federal student loan program.”
—Dr. Philip Day, President and CEO, NASFAA
“Although the legislation is complex in implementation, it has provided essential security to students and their families at a time of increasing insecurity in the financial markets.”
—David L. Warren, President, NAICU
Sallie Mae commends Congress, the U.S. Department of Education and the U.S. Department of Treasury for ensuring that federal student loans will be available to all eligible students and schools through the 2009–2010 academic year at no cost to taxpayers. The solution reaffirms the government’s longstanding commitment to a strong, competitive public-private partnership as the leading source of uninterrupted loan funds for students and parents.
Even amidst unfavorable economic conditions, Sallie Mae has processed all federal student loan applications for every eligible student at every eligible college. While other lenders have left the business, Sallie Mae remains committed to America’s schools and families. With successful implementation of this federal liquidity program and our ability to raise capital from other sources, Sallie Mae is ready, willing, and able to meet the needs of students, parents and colleges, this year and beyond, just as we have for the last 35 years. The company estimates that it will originate $20 billion or more in federal Stafford and PLUS loans eligible for participation in the Department of Education’s program this academic year.
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