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Lobbyists for the private lenders howled at the restructuring of the college lending program.
The House version phases out the wasteful part of the federal college lending program that pays private lenders a rich subsidy to make risk-free loans that are guaranteed by the government.
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Corinthian Colleges had created a similar private lending program, which was also the subject of a Consumer Financial Protection Bureau lawsuit last year.
About three-quarters of this country's college lending is carried out through the private program, known as the Federal Family Education Loan Program.
But in recent months, more colleges have joined the government's direct lending program, in anticipation of the change, generating the savings up front and reducing the amount of revenue that would be available for new spending to about $67 billion.
Over 2,300 colleges and universities participate in the direct lending program -- an increase of 1,300 over the past three years.
But the government's Direct Lending program is already up and running at the colleges that are responsible for 96% of all the student loans in the country, and originated 26% of all federal student loans last year.
The securities lending program imploded.
Seeking to reassure investors, Corinthian Colleges Inc., one of the nation's largest chains, recently said it was exploring "alternatives to help students fund their educational programs," including expanding its own lending program and finding new lenders.
No, Cornell Law School does not have an internal lending program.
The securities lending program was terminated in 2008.
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