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What's the difference for students between the direct loan program and the federal guarantee program? The rates are all the same, right? So, the only difference would be in the origination fees, and the who handles the servicing. Some lenders will repay your origination fees if you pay on time, but Direct doesn't.

Not true. The super low interest rates, rebates, automatic debit, and good customer service were virtually non-existent when all the loans were private.
The National Direct Loan program has been a great benefit to students and parents by providing competition to the banks, who had gotten very entrenched and overly comfortable in these programs previously. I know it's hard to believe that a government program would result in increased competition, but it has. SallieMae's "Great Rewards" and other similar programs are a result of this competition.

NelllieD

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