I just want to bring this to light. I've been hearing rumors of schools such as ours (foreign medical school) that chances of obtaining Title IV loan by this Fall or next year January is possible.

Before I begin please realize I am not trying to scare people. As a matter of fact this may even be a positive thing for us IMGs.

That being said please share your thoughts on the situation I'm about to present.

If you guys have been following the news, mainly the government's health bill.

washingtonpost.com

One of the points mentioned in the bill is
STUDENT LOAN OVERHAUL: Requires the government to originate student loans, closing out a role for banks and other private lenders who charge a fee. The savings - projected to be more than $60 billion over a decade - are plowed into higher Pell Grants for needy college students and increased support for historically black colleges.

If the Health care Bill gets passed, what we're going to see is the removal of private banking institutions from giving student loans. As a result the government will be in charge.

I did mention why we should view this as a positive thing because the high interest rate that some of us get from borrowing private bank loans is like Mad Max Highway Robbery.

How will this effect us?
Will this effect CitiBank?
Does this mean the government will reach out to us IMGs?
What do you think?

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For those who are not aware, the UMHS president is a member of a government committee that is planning the effect that an overhaul in the student loan program will have on IMGs. There is an old saying, "If you aren't at the table, you are on the menu!" UMHS is at the table!

The article is deceiving in that this change is only for Federal loans which are guaranteed by the government, not private loans. The government will stop paying a subsidy to the banks for these loans in which the banks assume no risk b/c it's guaranteed by the government if it defaults. It's a nice scheme of corporate welfare, no risk with a subsidy and all the upside on profits and charging students a 3% or more origination fee. Private student loans are unaffected b/c the banks actually put there own money at risk on a default and it's based on credit scores, thus if you noticed that's why the interest rates are higher than federal direct loans guaranteed by the government. Federal loans are not based on credit scores, but are guaranteed to everyone based on eligibility of the school and program.

so UMHS going to get FASFA this fall or jan?

lets just say.... they are working on it

It would be real nice for UMHS students to get FAFSA

Yes it would be great because its so hard to pay without it. Obtaining private student loans in this economy is really hard to do. no matter what credit score you have!

Not true. You only read about people getting disapproved here because this is where people talk about being disapproved.

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Gx255, you make an good point. People who get approved for loans usually mention it once on ValueMD. People who get disapproved keep talking about it until they finally get the loan or give up. Based on this, it appears that it is highly unlikely that anyone will get a loan...and yet UMHS has a classroom full of students each semester.

Admittedly, it is not as easy as it once was but people should not get discouraged.

anyone know if we will be able to get an update on this before the fall semester begins?