New Federal Laws Begin To Affect Arkansas Students

Students that have been using federal loan money to pay for their education at the University of Arkansas received an e-mail today explaining the new changes to the loan process after the passage of the Student Loan Reform bill.

The law mandated the all FFELP (Federal Family Education Loan Program) schools change to Direct Loan schools by July 1, 2010. The main difference between FFELP and the Direct Loan program is FFELP’s use of government funds. Private lenders who made loans to students under the FFELP received subsidies from the federal government. Under the Direct Loan program, the government lends directly to students.

Under FFELP guidelines, Arkansas students chose their own lender. Now with the Direct Loan program the Department of Education will be the lender.

There are two, one- time only, items both new and returning students need to complete for the Direct Loan Program. Both are found at https://studentloans.gov. Should you have problems with the website, please contact Direct Loan Applicant Services at 1-800-557-7394.

The University of Arkansas said the two items you will need to complete are Direct Loan Entrance Counseling and a Direct Loan Stafford Master Promissory Note (MPN). Once you have completed these two items, your loan money should come to the University of Arkansas in a timely manner. To ensure that your awarded loan funds apply to your student account, please complete both entrance counseling and your MPN by July 1.

Should you have questions or concerns, please call, email or come by the financial aid office at the University of Arkansas. The Financial Aid homepage (http://finaid.uark.edu) lists contact information for the office staff located under Information> Contact Your Counselor. The homepage has other information you might find useful such as their office hours, location, financial aid forms and Financial Aid TV.