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There are no lending banks. The money comes directly from the Department of Education.
by vonmoltke 7y ago
There are no lending banks. The money comes directly from the Department of Education.
- colejohnson66 7y agoEven a student loan from Wells Fargo?
- dredmorbius 7y agoThere are both US-government, and nongoverment private bank, student loans, in the US.
- vonmoltke 7y agoWhich are not guaranteed by the government. When speaking of government-backed student loans, which this discussion is, there are no banks.
- deleted 7y ago[deleted]
- dredmorbius 7y agoOK. That's confusing, and some brief DDGing finds a bit of a mess. Got any recommended references?
- vonmoltke 7y agoThe relevant Wikipedia article to start: https://en.wikipedia.org/wiki/Student_loans_in_the_United_States#Loans_to_students https://en.wikipedia.org/wiki/Student_loans_in_the_United_St... The relevant paragraph: > Prior to 2010, Federal loans included both direct loans—originated and funded directly by the United States Department of Education—and guaranteed loans—originated and funded by private investors, but guaranteed by the federal government. Guaranteed loans were eliminated in 2010 through the Student Aid and Fiscal Responsibility Act and replaced with direct loans because of a belief that guaranteed loans benefited private student loan companies at taxpayers expense, but did not reduce costs for students.