Direct Lending Could Overtake Bank-Based Student-Loan Programs Next Year

By Paul Basken

Washington

This year's growth in the Education Department’s direct-lending system could be replicated in 2009, possibly leaving the now-dominant bank-based system as the minority supplier of federal student-loan money by next fall, according to findings from a new survey of colleges.

The Web-based poll of 416 college financial-aid directors last week by Student Lending Analytics found that 6 percent of those currently using the bank-based system plan to switch to direct lending next