ISAC-Guaranteed Loans Up by 18%

SPRINGFIELD - The amount of educational loans guaranteed by the Illinois Student Assistance Commission (ISAC) grew by 18% over last year. During state fiscal year 2003, ISAC guaranteed nearly $872 million in federally-insured educational loans for students pursuing postsecondary degrees, up from $740 million during the previous year. Over 120,480 students borrowed loans guaranteed by ISAC in 2003, compared to 104,570 students in 2002.

If the current pace continues, ISAC will guarantee nearly $1 billion in student loans for the 2003-2004 academic year.

It’s not just that more students and parents are borrowing student loans, but they are borrowing more money, stated Larry Matejka, ISAC’s Executive Director. ISAC is the state’s centralized agency for administering scholarships, grants, and educational loans to help Illinois families pay for college education. The average loan borrowed for one year in fiscal year 2002 was $7,075, but the average loan in 2003 grew to $7,233, highly reflective of increases in college tuition.

The average amount borrowed by Illinois students for four years of college now exceeds $16,000, doubling the average amount borrowed ten years ago. And loans make up a larger percentage of student aid. In 1991, 47% of student aid awarded nationally was comprised of educational loans; that proportion is now 54%.

As a result of the down-turned economy, families have less money to contribute to college costs, but colleges are faced with increasing their tuition rates and neither the federal nor state government can keep up with the demand for grants or scholarships, explained Matejka. But student loans are available.

A plus to students who need to borrow educational loans, Matejka points out, is the interest rate on student loans, now at the lowest point ever. Students borrowing loans for this fall will see a 2.82% interest rate on their loans. In just three years, those rates have fallen by almost five percentage points.

Students looking for information on students loans or other types of financial aid can contact ISAC by calling 800-899-ISAC (4722) or by visiting the Web site at www.collegezone.com.

About ISAC
The Illinois Student Assistance Commission is the State’s centralized provider of financial assistance aimed at helping students and families access postsecondary education and/or training. Each year, the Commission awards an estimated $400 million in scholarship and grant aid to nearly 185,000 qualified students, and also provides an additional $740 million to borrowers through its student loan programs. The agency offers credit-based alternative loans, a 529 prepaid tuition program known as College Illinois!, and a broad array of outreach and informational services to ensure that families have access to the information they need to pay for a college education. More information is available by calling toll-free 800.899.ISAC (4722) or visiting the agency’s Web site at www.collegezone.com.