Federal loans to students and parents are secure at Western

Western students who borrow money for college probably won't be affected by the turbulence in the nation's student loan market, said Clara Capron, Western's director of financial aid.

That's because Western students - and parents - can borrow directly from the federal government through the Federal Direct Loan Program, which has included Western for more than a decade.

"WWU students and parents will not experience market-related disruptions of the receipt of their federal student loan proceeds," Capron said.

The federal loans, funded through the U.S. Department of Education, typically offer better terms than bank-funded loans, including lower interest rates, income-based repayment plans, loan forgiveness and other deferment options.

During the 2006-7 school year, 6,060 Western students borrowed a total of about $31.2 million from the federal loan program. That same year, 1,888 parents borrowed a total of about $16 million.

Of those who borrow money for college, only about 6 percent of Western students and about 3 percent of parents seek loans outside of the federally-funded program, Capron said. Those borrowers may now have fewer options from lenders, Capron said, and may face tighter credit checks.

Capron's advice: "Students should file their FAFSA's first before considering private loans anyway, because federal and state aid are a better deal than private loans."

The FAFSA, Free Application for Federal Student Aid, is the first application for federally funded student loans as well as other federal, state and insitutional aid.

Western's Feb. 15 deadline for priority consideration has passed, but it's not too late to be considered for some forms of financial aid for the 2008-2009 school year.