From the Consumer Bankers Association….

WASHINGTON (March 24, 2009) – Parents and students anxiously awaiting college admissions envelopes have every reason to be confident about getting federal student loans for the next school year. A controversial Obama Administration proposal would end federally guaranteed student loans, but no earlier than summer of 2010.

“The President’s Budget proposal has absolutely no effect on parents applying for guaranteed student loans for next fall and spring semesters,” Marcia Sullivan, Director of Government Relations for the Consumer Bankers Association, said. “While the college admissions process may give families a number of things to worry about, getting a federal student loan isn’t one of them.”

Returning students too will find federal student loans readily available for the next academic year. Families who have questions should contact the financial aid offices at their children’s schools.

Although the proposal’s effective date (July 1, 2010) is spelled out in the proposed Budget, many media accounts did not mention it. Moreover, the President’s Budget is just a proposal and must be approved by Congress. The process ordinarily is lengthy, requiring consideration and approval by four congressional committees, including hearings.

Families should also be reassured because of actions taken last year. Quick and decisive steps by Congress, the Administration and the student loan community last year have ensured that conditions in the credit markets will not affect the availability of federal student loans.

“Federal student loans will continue to be an oasis of stability,” Sullivan said.

The Consumer Bankers Association is the recognized voice on retail banking issues in the nation’s capital.  Member institutions are the leaders in consumer financial services, including auto finance, home equity lending, card products, education loans, small business services, community development, investments, deposits and delivery.

CBA was founded in 1919 and provides leadership, education, research and federal representation on retail banking issues such as privacy, fair lending, and consumer protection legislation/regulation.  CBA members include most of the nation’s largest bank holding companies as well as regional and super community banks that collectively hold two-thirds of the industry’s total assets.