Facts About Direct Loans The Direct Loan Program was created to simplify federal student loan delivery and provide borrowers with flexible repayment options with a single loan holder. Before Direct Loans, students and schools were forced to deal with a time consuming, abuse prone and complex student loan process, consisting of more than 7,000 lenders, 65 secondary markets and 35 guaranty agencies. The old system was characterized by numerous applications and forms, the sale of loans to multiple lenders, high borrower default rates and rising student debt levels with inflexible repayment terms. Direct Lending has revolutionized federal student loan delivery by providing borrowers and participating schools with a simple, streamlined and accountable system that saves taxpayers billions of dollars income contingent loan repayment over time, resulting in lower default rates, reduced administrative burdens for university financial aid departments.

The National Direct Student Loan Coalition (NDSLC) is comprised of schools dedicated to continuous improvement and strengthening of the Direct Loan program.  Its grass-roots members are financial aid professionals working at participating institutions. FACT SHEETS Feel free to use the following fact sheets: Benefits of Direct Lending Reports on Direct Lending GAO Comparison of DL and FFEL Application Repayment Plans Subsidy Estimates for Guaranteed and Direct Student Loans - Congressional Budget Office Accounting for Student Loan Costs, by Bob Shireman of the Aspen Institute