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June 04, 2010
Who Is American Student Assistance?
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American Student Assistance® (ASA) was founded in 1956 under the name Massachusetts Higher Education Assistance Corporation (MHEAC). MHEAC's idea was to create a pool of money to guarantee student loans, reaching out to local businesses for donations.
MHEAC went on to become the nation’s first student loan guarantor in 1956. Since then, we have administered the federal guarantee on student loans. By 1992, MHEAC had begun to expand its services nationwide, so we changed our name to American Student Assistance. Learn more about our company and our vision.
What Is a Student Loan Guarantor?
Student loan guarantors are nonprofit organizations that work with the U.S. Department of Education (ED), lenders, servicers, and schools to ensure student loan borrowers successfully repay their loans. Guarantors are just one of several key players in the student loan industry.
Under the Federal Family Education Loan Program, the federal government guaranteed private lenders against the risk of default, as an incentive for banks to make student loans. The traditional role of the guarantor was to administer this federal insurance, as well as assist lenders to prevent default and collect on defaulted loans. Additionally, some guarantors assisted lenders and schools with student loan origination and disbursement services.
At ASA®, we’ve evolved our role as a guarantor over the last decade. We voluntarily adopted a business model that centered on delinquency prevention instead of default collection. We use proactive outreach and education—in print, on the Web, via e-mail, and through one-on-one phone counseling—to help student loan borrowers manage their loan debt. We’ve had a positive effect on borrowers’ repayment habits.
Changes for the Student Loan Industry
Today, there are 2 sources used to originate federal student loans:
- ED, through the Direct Loan program (DL).
- Banks and other private lenders, via FFELP.
Recently, bill H.R. 4872 passed, which eliminates new FFELP loan origination starting July 1, 2010. This means ED will be the sole provider of federal student loans.
How Do These Changes Affect ASA?
ASA will keep providing debt management services to all of the borrowers with existing FFELP loans in our portfolio. You can continue to expect neutral, honest federal student loan solutions from ASA. Our focus is on your financial wellness, and it always will be.
We also continue to advocate for federal funding for education debt management so that all current and future borrowers can be entitled to the types of services we provide.
How Can ASA Help Me?
We provide you with the information you need to successfully repay your student loans. Our website is the best place to get started:
- Get answers to frequently asked student loan questions—check out Ask American Student Assistance.
- Find out how much your loans will cost—use our student loan calculators.
- Decipher student loan terms using our easy-to-understand glossary.
- Download the forms you need from our forms page.
- Sign up for e-mail payment reminders.
