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The lacklustre economic recovery will keep loan demand weak.
Disallow early withdrawals from retirement savings accounts, (but keep loan features).
Mr. Williams of PIRG argued that Congress must cast a wider net for financing, so it can pay for more Pell grants and keep loan rates low.
The subsidy was created at a time when lenders weren't interested in the student business and was intended to keep loan money flowing through tough economic times.
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The subsidized program, for example, was supposed to keep loans flowing during recessions.
"Investors rate servicers based on their ability to keep loans in a performing state and to turn nonperforming loans into performing loans," he said.
Lenders no longer needed to keep loans on their books, but could sell bundles of them to banks and investment funds at home or abroad.
And to keep loans cheap for companies and households, the business secretary says, it was vital to launch spending cuts and so maintain the UK's creditworthiness.
Fearing more bad news if banks were forced to disclose their real losses, Japan's leaders allowed banks to keep loans to "zombie" companies on their balance sheets.
Direct lenders who keep loans in their own portfolio are able to make "nonstandard" underwriting decisions or take risks that lenders who sell all their loans on the secondary market might not take.
The big question now is whether the federal government's move to take over Fannie and Freddie will restore investor confidence in the nation's credit markets, help stabilize the stock market and keep loans flowing to creditworthy borrowers.
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