However, the report says not all borrowers take out the maximum amount of Stafford aid available to them or receive a Stafford loan at all. According to data collected by the U.S. Department of Education in 2003-2004, 82 percent of dependent private borrowers and 53 percent of independent private borrowers received the maximum Stafford amount.
“Students may have already exhausted cumulative limits on federal loans and find they need to borrow to continue their education,” says McSwain. “But the private loan industry’s benefits versus the costs can vary and it definitely has an impact on overall debt.”
The report says it is difficult to predict the future of private loans, but students will continue to supplement financial aid with private loans as long as there is a continuing gap between financial aid packages and tuition costs.
— By Shilpa Banerji
© Copyright 2005 by DiverseEducation.com
