Honest Lending, Fair Lending
A Guide to Exposing Conflicts of Interests in School Financial Aid Offices
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This is Campus Progress’s step-by-step guide to probing campus financial aid offices for conflicts of interests that damage the student loan system. The guide comes in the wake of a groundbreaking investigation by New York Attorney General Andrew Cuomo and weeks of front-page newspaper disclosures about loan companies exerting apparent undue influence on colleges and college officials.
Students have a powerful incentive to ensure that their schools direct them to loans on fair terms, rather than to lenders who have developed cozy relationships with school administrators. With this guide, students and activists can review and expose campus practices and help get conflicts of interests out of college financial aid.
Most school officials care deeply about getting students the best financial aid deal possible, but the recent investigations have found that, in many cases the $85 billion student loan system has been corrupted. Lenders aiming to land on colleges’ “preferred lender” lists have provided Caribbean junkets, scholarships, stock options and other benefits.
When lenders compete by buying their way onto preferred lender lists, rather than through lowering their loan rates, both students and taxpayers lose.