Texas Schools Prep for Expected Loan Changes

By: Associated Press
By: Associated Press

AUSTIN, Texas -- Texas schools are prepping for what could be the biggest change in college assistance programs since Congress created them in the 1960s.

Changes proposed in Washington would mean federally guaranteed student loans only offered by the government, ending a role for banks and other for-profit lenders who charge fees.

The Austin American-Statesman reported Friday that Texas universities are joining thousands across the country abandoning the bank-based system.

The University of Texas this week announced it is cutting the program under which students borrow from private lenders.

UT is opting for the U.S. Department of Education's William D. Ford Federal Direct Loan Program. Students, starting this summer, will borrow directly from the government.

Texas A&M also is making the switch. Texas State University has offered the direct loan program since 1994.

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