Until recently, college students and parents could apply for Stafford Loans from two sources: the U.S. Department of Education or private financial institutions. Colleges typically had a preferred lenders list – up to ten or more – each with their own criteria for making education loans.
Now however, new legislation passed by Congress and signed by the President specifies that low interest Stafford Loans—now called Direct Loans—are available exclusively from the U.S. Department of Education. That’s important to know, because with no origination fees, these government-backed direct loans can save you money.
Of course, alternative student loans are still available through private lenders and other sources. To learn about all of your college loan options, check with your university’s financial aid office.