September 14, 2007

Lender Subsidies May Be Cut

By KELLY FIELD

Congress was poised late last week to pass a compromise bill that would slash subsidies to lenders in the government's guaranteed-student-loan program and use the savings to reduce the federal deficit and increase student aid.

The measure would cut government subsidies to for-profit lenders by a little over half a percentage point while halving the interest rate on federal student loans and raising the maximum Pell Grant to $5,400 over five years. It would also test the controversial

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