THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, March 4, 1995 TAG: 9503040439
SECTION: LOCAL PAGE: B5 EDITION: FINAL
SOURCE: BY SHARON LAROWE, CAMPUS CORRESPONDENT
LENGTH: Short : 38 lines
James Madison University has decided not to join the direct lending program, which eliminates banks and guarantee agencies to streamline the student loan process.
Old Dominion University is the only four-year school in Virginia participating in the project. But more than 30 Virginia schools, including JMU and Norfolk State University, were approved by the U.S. Department of Education to begin participating this fall.
The program has been praised by participants for reducing paperwork and getting checks to students faster. Some Republicans, on the other hand, have wondered whether it will cost the government more money.
John Sellers, James Madison's financial aid director, said JMU decided to pull out this year because the university is expanding its computer network and officials felt they could not take on another big project at the same time.
He also was worried that the change would damage the university's relationship with private lenders. The federal program is ``taking a big bite out of the private sector's business. We're getting much better, personal attention'' from the banks, he said.
Sellers said, ``We're not saying we're not going (to) direct lending. We're just going to wait a year or two.''
More than 100 schools nationwide began direct lending last fall, said Deb Angstadt, marketing director of the Virginia Student Assistance Authorities, the state's loan guarantee agency. Nearly 2,000 more will join this year, she said. by CNB