Information regarding Syracuse University’s participation in the Recommended Lender Loan Process
Information regarding Syracuse University’s participation in the Recommended Lender Loan ProcessMarch 17, 2007Kevin C. Quinnkcquinn@syr.edu
This past week, New York State Attorney General Andrew Cuomo announced an investigation into lending practices involving colleges and universities, and Syracuse University was one of a number of college and universities mentioned in media coverage regarding this issue.
In recent years, higher education institutions across the nation, including Syracuse University, began maintaining recommended alternative loan provider lists, as a service to their students. These lists identified lenders who were committed to good-faith student lending practices and offered quality loans and customer service.
Nationally, this practice began at a time when there were thousands of different lenders at various levels of customer service, which in some cases resulted in service problems for students, their families, and their college/university. To help address this problem, some colleges and universities began identifying lenders who guaranteed a level of service and competitive financial rates, and passed along those lenders’ names to their students.
Under the recommended lender process Syracuse University uses, students can select a lender on this list (which totals at least five), but are not obligated to do so, and the Office of Financial Aid readily accepts alternative loan applications from any lenders that students or families choose. Most critically, no student is disadvantaged by using any of the recommended lenders, as every lender on the University’s list must offer at or below current market rate loans.
In fact, each year the University, through a committee consisting of financial aid professionals highly experienced in student loan policies and practices, evaluates each of the lenders on the list based on a wide array of criteria such as competitiveness of their rates, quality of their service, and flexibility of repayment options. More information on this is available at SU’s Office of Financial Aid’s website: http://financialaid.syr.edu/Alternativeloans.htm.
Yet, Attorney General Cuomo has raised an important issue regarding the fact that many institutions accept referral fees from some lenders that are on their recommended lender lists.
Syracuse University applauds Attorney General Cuomo’s efforts on behalf of college students. The University is fully cooperating with his office, had discussions with his staff this past week, and will be meeting with them this coming week. The University looks forward to working with the Attorney General’s Office on this issue.