FFELP Lender Choices
FFELP lender choices can be confusing for both student and parent loan borrowers.  Federal student loan borrowers always have the option by federal law to utilize one of thousands of FFELP lenders at FFELP schools. The Division of Financial Aid has produced an alphabetical listing of more than seventy FFELP lenders that Purdue students and parents have utilized in recent years. In addition, www.finaid.org maintains a more comprehensive list of FFELP lenders with contact information at www.finaid.org/loans/educationlenders.phtml, Purdue University and the U.S. Department of Education encourage FFELP borrowers to compare lender choices on their own. Information about how to choose a FFELP lender is available from the the U.S. Department of Education and from websites like www.finaid.org.

For your information, FFELP lenders and loan service providers can vary in terms of customer service quality and borrower benefit loan discounts. The most common loan discounts include an interest rate reduction for having your monthly loan payments direct debited from your bank account (and also often requiring online electronic statement delivery). This is an example of a "back-end" borrower benefit. Many lenders also waive the origination fees on Stafford Loans. This is an example of a "front-end" borrower benefit. Depending on the guarantor, they may also waive the 1% guarantee fee.

Purdue West-Lafayette Preferred Lender Selection Process
To advocate for Purdue FFELP loan borrowers, in compliance with CFR 682.212, Purdue Univeristy conducted a Request for Proposal (RFP) process that began in late 2007 to choose a list of preferred FFELP lenders and loan service providers.  A campus wide committee of administrators led by Purdue University Purchasing Services conducted this RFP process on behalf of Purdue borrowers. The agreed-upon selection criteria included a holistic review of proposals that met minimum criteria. For example, Purdue expected the vendor arrangement to insure life-of-loan servicing to borrowers that provides a single-point-of-contact from loan origination through repayment. In addition, Purdue expected the vendor arrangements to provide web-based credit approval processes, and offer toll-free, single-point-of-contact telephone and web-based customer service. Scoring of vendor proposals was weighted based on the quality of borrower benefits offered (75%) and the demonstrated experience/competence of the vendor arrangement (25%). Through this competitive bidding process, four non-affilated FFELP lenders emerged: Fifth Third Bank, PNC Bank, Purdue Employees Federal Credit Union, and Sallie Mae Educatonal Trust. These lenders are considered preferred for the summer 2008 semester. Contact these lenders to confirm current borrower benefit programs.

For the fall 2008 semester, Purdue-West Lafayette is moving to the Direct Loan program.