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Applying through the school is an option but not the only way to do it. One can apply directly online with the dept. of ed and tell them which univ. gets the funds. The borrower makes the decision, not the govt. The govt. looks at the credit of the borrower based on the FAFSA. The school receives the dispursement directly if the loan is directed that way...thank goodness or you’ll have situations like octomom all over taking the money and not paying the school.

I’m not sure who makes the credit decision if a bank takes the application...I would not think that they enough skin in the game to make the credit decision since it’s not their money.

You can do the paperwork on-line, but you must be accepted by a institute of higher learning, before you can start the paperwork. This is all coordinated through the fiscal office at your university. Yes, money will go directly to the school in some cases, but not all. My problem with this bill is the government will have total control over every aspect of a person getting an educational loan. One criteria they could use is what school they are going to and that would be detrimental to conservative schools and there are still a few out there.