NASFAA Survey on Transition to Direct Lending Presented At Annual Conference

I received notes from the recent NASFAA Conference in San Antonio, where Justin Draeger, NASFAA's Vice President of Public Policy, Advocacy and Research presented the following information (some of this information was also summarized in recent Inside Higher Ed article):

Sample:  160 NASFAA institutions that recently moved to Direct Lending (30% response rate)

Key findings:

• Ease of implementation: 73% of the institutions that have switched from FFEL to DL in the last year said the switch to Direct Lending was easier than they thought
  
  • 4% said it was more difficult

• Resources to assist in implementation:  84% said the Department of Education was helpful in providing assistance for the conversion and 88% said other schools were also helpful

• Administration of DL program:  61% said the burden of administering the DL program was less than the FFELP program; 24% said it was the same; 14% said it was greater.

• Staffing requirements of Direct Lending: 84% said they neither had to increase nor decrease the number of staff to administer the DL program.

• Greatest difficulty: Working with software developers and in-house IT staff
  • 10% said software developers were unhelpful

• Time to convert
  • 80% able to convert within four months
  • 14% indicted that it took longer than seven months

NASFAA should be presenting their complete results from this survey within the next week and it will be interesting to note the composition of the survey sample (large vs. small, public vs. private, software used).  While we are on the topic of DL implementation,  The Chronicle of Higher Education had recently reported on concerns that small schools are having about the cost to transition to Direct Lending. 

Comments

[Direct response expert]

I think moving to direct lending will be really a good choice for them.

-Daniel