NH students find loans despite lender's troubles
CONCORD, N.H. --News that New Hampshire's leading student loan issuer would stop providing about $70 million in private loans sent shivers down some spines in March.
But with the fall term almost here, several schools said Thursday that students seem to be having success lining up private loans from sources other than the New Hampshire Higher Education Loan Corp.
The officials said an increase in the amount of federal student loan money available this year also has helped.
"We're not seeing any evidence that students are being affected at this point," said Mark Rubinstein, the vice president of student and academic services at the University of New Hampshire in Durham.
Rubinstein said that although some lenders have stopped providing private loans, other lenders are stepping forward to fill that need.
Susan Peery, a spokeswoman for Keene State College in Keene, agreed.
"Most students are able to put together alternatives to come up with a financial aid package that works for them," Peery said.
NHHELCO, which provided about 80 to 85 percent of loans in state, announced it would stop providing private loans in March after the specialized securities market where it raised much of its money collapsed.
On Thursday, state securities regulators accused the company's underwriter and financial adviser, UBS Securities LLC, of fraud. The bank denied it.
By partnering with state banks and credit unions, NHHELCO is still providing about $90 million in federal loans, such as Stafford and PLUS loans. In the past, NHHELCO typically provided students at universities like UNH with about $8,000 in additional private loans.
"Students use that to cover the gap between what students receive in financial aid and what the college actually costs," said NHHELCO spokeswoman Tara Payne. "They were a low-cost, affordable option for students."
However, this year undergraduates are eligible to receive an additional $2,000 a year in unsubsidized Stafford loans.
"It's not gloom and doom," said June Schlabach, director of financial aid at Plymouth State University in Plymouth. "Talk to your financial aid offices and they will help you with your options. Students will be able to return to their schools."
She warned that students whose families have credit issues may have a harder time getting loans.
NHHELCO is not the only lender to stop offering certain student loans.
About 130 lenders have suspended federal or private loan programs, in some cases both, according to http://www.finaid.org, which provides loan and scholarship information.
Last month, the Massachusetts Educational Financing Authority announced it wouldn't be providing private loans to students because of the turmoil in credit markets. 