2008 Woodie Awards
Lending changes affect UCF
Dep. of Ed. releases new regulations
Lauren Erlich
Issue date: 11/21/07 Section: News
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The Department of Education released new regulations for student lending that will correct issues found in the lending practices in many colleges across the country.
These new rules, effective July 1, will affect about a fourth of the UCF population.
This fall, 12,636 students had at least one student loan, said Lisa Minnick with the Office of Financial Assistance.
All financial aid offices in the country must be in compliance as of the effective date.
The regulations resulted from a year-long investigation by the New York Attorney General, Andrew Cuomo, into the relationship between universities and lenders.
The investigation stemmed from an accusation that many colleges across the country were taking bribes from lending institutions in order to ensure that those lenders were recommended by college financial aid offices.
The investigation did not imply UCF, but the regulations will still affect the way that the UCF Office of Financial Assistance provides loan information to interested students.
UCF, however, was one of 40 implicated by Cuomo in an August investigation into the relationship between athletic departments and the lender Student Financial Services, under the name University Financial Services.
The investigation alleges that UFS was offering kickbacks to athletic departments in exchange for presenting UFS to athletes as the preferred lender.
The new regulations are meant to ensure that students and parents have a complete understanding of the process of acquiring a loan, Minnick said.
"The new regulations are trying to provide more transparency and disclosure to help students and parents when choosing a lender," she said.
In order to provide students with needed funds, many schools use preferred lender lists to supply students with student loan information. These lists include the suggested lenders in order of the school's recommendations.
According to ed.gov, the Web site for the Department of Education, the new regulations require that schools that utilize preferred lender lists provide students with at least three lender choices and include the school's criterion for the order of importance.
These new rules, effective July 1, will affect about a fourth of the UCF population.
This fall, 12,636 students had at least one student loan, said Lisa Minnick with the Office of Financial Assistance.
All financial aid offices in the country must be in compliance as of the effective date.
The regulations resulted from a year-long investigation by the New York Attorney General, Andrew Cuomo, into the relationship between universities and lenders.
The investigation stemmed from an accusation that many colleges across the country were taking bribes from lending institutions in order to ensure that those lenders were recommended by college financial aid offices.
The investigation did not imply UCF, but the regulations will still affect the way that the UCF Office of Financial Assistance provides loan information to interested students.
UCF, however, was one of 40 implicated by Cuomo in an August investigation into the relationship between athletic departments and the lender Student Financial Services, under the name University Financial Services.
The investigation alleges that UFS was offering kickbacks to athletic departments in exchange for presenting UFS to athletes as the preferred lender.
The new regulations are meant to ensure that students and parents have a complete understanding of the process of acquiring a loan, Minnick said.
"The new regulations are trying to provide more transparency and disclosure to help students and parents when choosing a lender," she said.
In order to provide students with needed funds, many schools use preferred lender lists to supply students with student loan information. These lists include the suggested lenders in order of the school's recommendations.
According to ed.gov, the Web site for the Department of Education, the new regulations require that schools that utilize preferred lender lists provide students with at least three lender choices and include the school's criterion for the order of importance.