Students can sign online for education loans

Students can sign online for education loans

BY PREETI VASISHTHA | GCN STAFF

The Education Department this month launched an electronic-signature option for the 13 million student loan applications it receives each year.

Borrowers who are eligible for the Federal Family Education Loan and William D. Ford Federal Direct Loan programs can sign for the loans online using a personal identification number issued by Education's Office of Student Financial Assistance.

Applicants can fill out forms online and sign them digitally; no paper applications or signature forms are necessary.

'Our goal is to make financial aid available to students, and advances like this one make the aid process faster and more convenient for students without compromising the quality and reliability of the application process,' Education Secretary Rod Paige said.


'Our goal is to make financial aid available to students, and advances like this one make the aid process faster and more convenient for students without compromising the quality and reliability of the application process.'
'EDUCATION SECRETARY ROD PAIGE


Work on the initiative, which started in January, is being done under a task order through OSFA's modernization contract with Accenture of Chicago. The firm, formerly known as Andersen Consulting, signed the modernization deal in September 1999, said Steven R. Shane, a senior partner at Accenture.

A host of contractors have made changes to OSFA's legacy systems for the initiative under other contracts, he said.

NCS Pearson Government Solutions of Arlington, Va., upgraded the PIN system, which issues each borrower a unique number, and the central processing system, which stores the borrowers' applications, Shane said.

Electronic Data Systems Corp. made improvements to the Direct-Loan Servicing System, which receives approved loans and performs account maintenance, interest accrual and payments.

Affiliated Computer Services Inc. of Dallas worked on the Loan Origination System, which accepts funding requests from colleges and confirms the eligibility of students, he said.

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Users of the e-signature app will visit multiple Web sites to complete the application process.

Borrowers will fill out forms on lenders' Web pages using Secure Sockets Layer encryption to protect the information, an Education spokeswoman said.

The lender sites will then direct borrowers to another site where four authentication factors'name, birth date, Social Security number and PIN'will be validated, she said.

After validation, the borrowers will return to the lender sites, which then guide the applicants through the required steps, recording each stage of the process in an electronic file.

At the end of the process, the lender sites will supply the borrowers with an Adobe Portable Document Format file of the completed promissory note, she said.

Users will still have the option of mailing in signature forms, Shane said. Currently half of the applications are received electronically.

Many services are available on Education's Web site:


  • Information about college and student aid, both loans and grants, is available at www.students.gov.


  • Users can get a PIN at www.pin.ed.gov.


  • The Free Application for Federal Student Aid form is available at www.fafsa.ed.gov. This can be completed online.


  • Borrowers can set up an electronic debit account to have their loan payments deducted electronically. An application is available at www.dlservicer.ed.gov under Download Forms.


  • Borrowers can consolidate their loans at www.loanconsolidation.ed.gov.

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