Press Releases
College Board to End Role as Student Lender
08/22/07
NEW YORK—The College Board is ending its role as a lender in the Federal Family Education Loan Program (FFELP) and will not accept new loan applications after Oct. 15, 2007.
The College Board will continue to honor its obligations to existing borrowers through the 2007-2008 academic year.
The College Board’s decision to end its student loan program was based on the enactment of new legislation and codes of conduct regarding the student loan industry.
While the legislation and codes are well-intentioned, they have had the unintended consequence of limiting the College Board’s ability to fulfill its mission and obligations as a membership association while continuing as a student lender.
The new law and the codes impose a host of restrictions on, among other things, the meetings of education professionals. These meetings are the lifeblood of the College Board, benefiting not only its member institutions but also students, parents and higher education.
“The College Board is unique among student lenders in that it is a membership association,” said Michael Bartini, senior vice president for enrollment at the College Board. “Our membership meetings are critical to our mission, and it is essential that all our members—regardless of their financial resources or location—feel comfortable attending without concern that they are violating new laws or code provisions.”
The College Board routinely convenes meetings of education professionals, including the College Scholarship Service Assembly (CSS). The CSS considers policies, practices and procedures designed to help students and families prepare to meet the costs of postsecondary education and to support institutions, agencies and organizations in the equitable and efficient administration of student financial aid programs.
“Our membership activities, professional development and informational work with schools and financial aid professionals take precedence over our participation in this, or any, line of business, and we have concluded that, in the best interest of our members, we have been left with no choice other than to end our student loan program,” Bartini said.
The College Board is working to minimize any inconvenience for borrowers, students and their families.
“We believe there are many ways, other than being a lender, that we can use the College Board’s resources and financial aid expertise to serve institutions and families,” said Bartini. “We are exploring these alternatives and remain committed to providing students and parents with the information they need to make sound decisions regarding the financing of higher education.”
College Board as a Lender
As a lender in FFELP, the College Board contracted with Sallie Mae and Citibank to originate, service and purchase students loans. Citibank and Sallie Mae then service loans from the point of origination through repayment.
The Education Loan Program is a very small part of the Board’s overall portfolio of programs and services for schools, students and parents. About 15 College Board employees are affected by this decision.
For more information, please contact the Communications office:
Edna Johnson at (212) 713-8158, ejohnson@collegeboard.org
Sandra Riley at (212) 713-8065, sriley@collegeboard.org