Federal Student Loans Made Under the Federal Family Education Loan Program and the William D. Ford Federal Direct Loan Program: Terms and Conditions for Borrowers

David P. Smole
Specialist in Education Policy

The William D. Ford Federal Direct Loan (DL) program, authorized under Title IV, Part D of the Higher Education Act of 1965 (HEA), as amended, is the primary federal student loan program administered by the U.S. Department of Education (ED). The program makes available loans to undergraduate and graduate students and the parents of dependent undergraduate students to help them finance their postsecondary education costs. Several types of loans are offered through the DL program: Subsidized Stafford Loans and Unsubsidized Stafford Loans for undergraduate and graduate students; PLUS Loans for graduate students and the parents of dependent undergraduate students; and Consolidation Loans through which borrowers may combine their loans into a single loan. For FY2011, ED estimates that 24.3 million loans (not including Consolidation Loans) totaling $116.4 billion will be made to students and their parents through the DL program.

Until July 1, 2010, Subsidized Stafford Loans, Unsubsidized Stafford Loans, PLUS Loans, and Consolidation Loans were also available through the Federal Family Education Loan (FFEL) program, authorized under Title IV, Part B of the HEA. The SAFRA Act, part of the Health Care and Education Reconciliation Act of 2010 (HCERA; P.L. 111-152), terminated the authority to make new loans under the FFEL program after June 30, 2010. While new loans may no longer be made through the FFEL program, approximately $450 billion in FFEL program loans are outstanding and are due to be repaid over the coming years.

Under the DL program, which has effectively replaced the FFEL program, loans are made with capital provided by the federal government. Under the FFEL program, loans were made with capital provided by private lenders, and the federal government guaranteed lenders against loss through borrower default, death, permanent disability, or, in limited instances, bankruptcy. When both programs were authorized and making available essentially the same types of loans, institutions of higher education (IHEs) were permitted to select the program of their choice.

The loans made through the FFEL and DL programs are low-interest loans, with maximum interest rates for each type of loan established by statute. Subsidized Stafford Loans are unique in that they are only available to students demonstrating financial need. The Secretary of Education pays the interest that accrues on Subsidized Stafford Loans while borrowers are in school, during a six-month grace period, and during authorized periods of deferment. Unsubsidized Stafford Loans and PLUS Loans are available to borrowers irrespective of their financial need; and borrowers are responsible for paying all the interest that accrues on these loans.

FFEL and DL program loans have terms and conditions that may be more favorable to borrowers than private and other non-federal loans. These beneficial terms and conditions include interest rates that are often lower than rates that might be obtained from other lenders, opportunities for repayment relief through deferment and forbearance, loan consolidation, and several loan forgiveness programs.

In recent years, numerous changes to the terms and conditions of FFEL and DL program loans have been made under the College Cost Reduction and Access Act (P.L. 110-84), the Ensuring Continued Access to Student Loans Act (P.L. 110-227), the Higher Education Opportunity Act (P.L. 110-315), the 2009 technical corrections to the HEA (P.L. 111-39), and the SAFRA Act. This report describes the terms and conditions of loans currently available to borrowers through the DL program and of loans made in recent years through the FFEL and DL programs.


Date of Report: February 7, 2011
Number of Pages: 66
Order Number: R40122
Price: $29.95

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Assessment in Elementary and Secondary Education: A Primer

Erin D. Lomax
Analyst in Education Policy

In recent years, federal education legislation has placed an increased emphasis on assessment in schools. Perhaps most notably, Title I-A of the Elementary and Secondary Education Act (ESEA), as reauthorized by the No Child Left Behind Act (NCLB), requires states to test all students annually in grades 3 through 8 and once in high school in the areas of reading, mathematics, and science. These assessments are used as key indicators in an accountability system that determines whether schools are making progress with respect to student achievement. To receive Title I funding, states must also participate in the National Assessment of Educational Progress (NAEP), a standards-based national test given at grades 4 and 8. The Individuals with Disabilities Education Act (IDEA) requires states to use assessments to identify students with disabilities and track their progress according to individualized learning goals. In addition to assessments required by federal law, elementary and secondary school students generally participate in many other assessments, which range from small-scale classroom assessments to high-stakes exit exams.

This report provides a framework for understanding various types of assessments that are administered in elementary and secondary schools. It broadly discusses various purposes of educational assessment and describes comprehensive assessment systems. Common assessment measures currently used in education are described, including state assessments, NAEP, and state exit exams. The report also provides a description and analysis of technical considerations in assessments, including validity, reliability, and fairness, and discusses how to use these technical considerations to draw appropriate conclusions based on assessment results. Additionally, innovation in assessment is discussed, including the development and use of alternate assessments and performance assessments. Finally, this report provides a brief analysis of the use of assessments in accountability systems, including implications for curriculum, students, and testing.


Date of Report: February 4, 2011
Number of Pages: 43
Order Number: R40514
Price: $29.95

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Education of Individuals with Disabilities: The Individuals with Disabilities Education Act (IDEA), Section 504 of the Rehabilitation Act, and the Americans with Disabilities Act (ADA)

Nancy Lee Jones
Legislative Attorney

Several federal statutes, notably the Individuals with Disabilities Education Act (IDEA), Section 504 of the Rehabilitation Act, and the Americans with Disabilities Act (ADA), address the rights of individuals with disabilities to education. Although there is overlap, particularly with Section 504 and the ADA, each statute plays a significant part in the education of individuals with disabilities, and is of interest to Congress both in preparing for the reauthorization of IDEA and in oversight of recent amendments to the ADA. IDEA, enacted in 1975, is both a grants statute and civil rights statute and requires programs for children with disabilities that are in addition to those available to children without disabilities. Section 504, enacted in 1973, and the ADA, enacted in 1990, are civil rights statutes that prohibit discrimination against individuals with disabilities. Their coverage is similar and the ADA was modeled on Section 504 and its regulations; however, the major distinction is that Section 504 only applies to entities that receive federal financial assistance, while the ADA has broader coverage, not tied to the receipt of federal funds. This report will examine the similarities and differences in the IDEA, Section 504, and ADA coverage of education including the implications of the ADA Amendments Act of 2008.


Date of Report: February 3, 2011
Number of Pages: 17
Order Number: R40123
Price: $29.95

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The Post-9/11 Veterans Educational Assistance Improvements Act of 2010, As Enacted

Cassandria Dortch
Analyst in Education Policy

The Post-9/11 Veterans Educational Assistance Act of 2008 (Title 38 U.S.C., Chapter 33), commonly called the Post-9/11 GI Bill, was enacted as Title V of P.L. 110-252. It became effective August 1, 2009. Following enactment, concerns were raised about several aspects of the Post-9/11 GI Bill, and calls were made for the program to be amended. These included proposals to expand eligibility and to improve the program’s implementation, administration, and benefits. The Post-9/11 Veterans Educational Assistance Improvements Act of 2010 (P.L. 111-377) was enacted on January 4, 2011. It amends the Post-9/11 GI Bill and other veterans educational assistance programs. Major amendments made by P.L. 111-377 to the Post-9/11 GI Bill and other veterans educational assistance programs include the following: 

• Certain full-time duty by National Guard members under Title 32 is included in the qualifying active duty service period.
• Active duty service obligations based on an appointment at the U.S. Coast Guard Academy (USCGA) are excluded from the qualifying active duty service period. 
• Up to full in-state tuition and fees less certain waivers, reductions, scholarships, and assistance to degree-seeking individuals will be available to those who attend public institutions of higher learning (IHLs) more than half-time. 
• Up to $17,500 in tuition and fees will be available to degree-seeking individuals who attend private or foreign IHLs more than half-time. 
• A reduced monthly housing allowance will be provided to degree-seeking individuals who attend IHLs more than half-time but less than full-time. 
• Degree-seeking individuals who attend IHLs more than half-time exclusively through distance learning will be eligible for a monthly housing allowance. 
• Degree-seeking individuals on active duty who are enrolled more than half-time will be eligible for a books and supplies stipend, but the tuition and fees benefit will be limited. 
• The approved programs of education will be expanded to include on-the-job, apprenticeship, flight, and correspondence training and programs at non-IHLs. 
• The number of licensing and certification tests eligible for reimbursement will be unlimited as long as the individual has sufficient entitlement remaining. 
• The transfer of benefits to dependents will be authorized for commissioned officers in the Public Health Service (PHS) and National Oceanic and Atmospheric Administration (NOAA). 
• Reporting fees to training establishments and educational institutions for administering veterans educational assistance programs will be increased. 
• Individuals eligible for both Vocational Rehabilitation and Employment (VR&E; Title 38 U.S.C., Chapter 31) and the Post-9/11 GI Bill will be eligible for an increased housing allowance. 
• Most payments between academic terms for all the veterans educational assistance programs will be eliminated.

Date of Report: January 31, 2011
Number of Pages: 35
Order Number: R41620
Price: $29.95

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To order, e-mail Penny Hill Press  or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.