What are ffelp loans
Federal Family Education Loan Program (FFELP) Lender Information
As a borrower, you choose your lender, regardless of whether they are listed on any list. Lenders may have multiple lender codes, so make sure you are using the correct lender code associated with the borrower benefit program in which you are interested. It is YOUR responsibility to select YOUR lender. You may select any lender that participates in the Federal Family Education Loan Program (FFELP). SFA encourages you to review all of the available information very carefully.
Choosing a Lender
Choosing the right lender for your education loan is an important decision and may save you significant amounts of money. You should base your choice on two major criteria: borrower benefit programs and customer service. Borrower benefits are programs that help reduce the cost of repaying your loan. Fairly typical programs include payment of origination and/or guarantee fees, interest rate/principal balance reductions for a certain number of on-time monthly payments, and interest rate reductions for automatic payments. Borrower benefit programs vary from lender to lender and year to year so you'll need to check with each lender. Doing your homework on choosing a lender will save you money when it comes time to repay your loan. Below are some factors to take into consideration when you select lender:
- Customer service to student borrowers
- Borrower benefit programs and the savings provided during the origination and repayment process
- Electronic processes that speed the loan processing
- Life of loan servicing
Customer Service is an important factor to consider when choosing a lender. Since the standard repayment period on a loan is 10 years, you will have a relationship with your lender for at least that length of time. In addition, many lenders sell their student loans after they are disbursed or enter repayment. You will then be working with another organization for the repayment period of your loan. Since it is your responsibility to repay the loan, you will need to stay in contact with the servicer of the loan.
Here are some common questions you should ask your lender about borrower benefit programs:
- What borrower benefit programs do you offer?
- How do I qualify for your borrower benefit programs?
- Which lender code do I use to be eligible for the borrower benefit programs?
- What is an estimate on savings from qualifying for the borrower benefit programs?
- Do you have a calculator to estimate the savings based on different loan amounts?
- What is the percentage of borrowers who qualify for each of your borrower benefit programs?
Here are some common questions you should ask your lender about loan servicing:
- Do you sell your student loans? If yes, to whom?
- If the loan is sold, when will it occur and how will I be notified?
- Provide the contact information for the servicer.
- What Web-based services do you provide? (Online account information, online bill presentment and payment, credit/bank card payment, etc)
- Will the servicer hold both my Federal and Private Education Loans? If so, will combined billing be provided?
Below are some of the important criteria that the SFA Financial Aid Office considers when choosing preffered lenders:
- Lenders should be using electronic methods and procedures of student loan processing
- Electronic Funds Transfer (EFT) capability
- Competitive pricing for interest rates and borrower benefits
- Knowledgeable customer service representatives that provide responsiveness to borrowers and financial aid staff
- Variety of lender products including FFELP and alternative loans
- “Life of loan” service, lenders who originate and service their own loans.
- Positive and negative feedback from the experiences of previous borrowers
- Our track record with the lender must be positive
Students at Stephen F. Austin State University may use any lender of their choice, including lenders not on this list. No contractual relationship exists between Stephen F. Austin and any lender. SFA lenders are evaluated on an annual basis using criteria such as, use of electronic loan processing, borrower benefits, customer service, variety of loan products, and life of loan servicing. If you are selecting a lender for the first time, TGSLC maintains Lender Fact Sheets on its web site.Source: www.sfasu.edu