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September 02, 2009


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FinAid Administrator

The discrepancy may have something to do with using awarded loans vs. disbursed loans. Schools award more in loans than students accept. I believe The College Board uses loans awarded and the Dept. of Ed uses loans disbursed.


In FFEL, awarded is 15 to 20 percent higher than disbursed. In DL it is much closer because there are fewer middlemen involved to communicate all the changes/adjustments in attendance and attendance intensity as well as cancels.

Ms. C. Cryn Johannsen

I'm not understanding this, and have been debating about it with Patricia Steele at the College Board


The most recent CB publication, "Trends in Student Aid 2008," indicates that CB made a radical change in how it presents the information it receives from the U.S. Department of Education:

"Stafford, PLUS, and Perkins Loans. Data provided by the Department of Education on education loan disbursements. Trends in Student Aid reports before 2007 reported instead on loan commitments, a larger number including some loans approved but never disbursed."

CB probably reached the same realization as the National Center for Education Statistics (NCES), http://nces.ed.gov/das/new/index.asp , that there is a lot of "loosey-goosey" operational practice in the FFEL program and a huge difference between gross commitments vs. net commitments -- or dollars guaranteed vs. dollars disbursed.

However, it is not clear from CB's statement whether CB has obtained disbursed dollars for only a couple years back, or back to 1997-98, or even further. Most likely CB would have to continue to use gross commitments for older years in its charts and tables, because new metrics for old years would not not be available.

It is strange that all these groups are just coming to these realizations. John B. Lee and many others in the field have long realized the significant differencesb based on how origination volumes are measured. They tend to prefer the gross amounts, because they are available much faster and also can be compared to earlier years much easier. Net for 2008 can't be compared to net for 2004. 2008 is still in flux with active adjustments and cancellations, while 2004 is experiencing far fewer adjustments and cancellations on a monthly basis. It is not clear how CB is going to be able to say that it has a net figure for 2008-09 or even 2007-08 when the "Trends" report comes out next month.

Ms. C. Cryn Johannsen

Craigie - what a great post. This site had been enormously helpful for my own writing about the student lending crisis.

Your post provides me with a wealth of helpful information, too.

I'm so glad I found this site - I promote you regularly at my blog. I hope that you're getting traffic as a result.


Ms. C. Cryn Johannsen, Promotional Writer and Marketer, Robert Applebaum's Forgive Student Loan Debt Movement
Robert Applebaum's site: http://www.forgivestudentloandebt.com/
My blog: http://alleducationmatters.blogspot.com/

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