April 25, 2008

Loan 'Crisis' Has Players Swapping Traditional Roles

By PAUL BASKEN

In its latest effort to calm a few jittery colleges and politicians, the Education Department set off this month to develop, in just 11 weeks, an entirely new system for distributing federally guaranteed student loans in the event of a "crisis" in the government-backed system.

But even department leaders don't expect the proposed new "lender of last resort" system, in which the federal government would make sure students could find loans if a loan emergency were declared, will be

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