Facts About Iowa Student Loan
Iowa Student Loan was established in 1979 as a private, nonprofit corporation. Its mission is to help Iowa students and families obtain the resources necessary to succeed in postsecondary education. Iowa Student Loan has helped more than 375,000 students pay for college.
Based in West Des Moines, Iowa, the organization:
- Employs more than 345 employees and manages $2.8 billion in student loans.
- Is self-funded and self-capitalized.
- Is governed by a board of directors that, since its inception, has been appointed by the governor of Iowa.
- Does not have shareholders, nor does it receive state appropriations.
Operating as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code, Iowa Student Loan is subject to strict regulation of its exempt purpose and use of funds. No funds may be used for the private benefit of any officer or director of the company.
How Iowa Student Loan Operates
Iowa Student Loan disburses and services both its own private loans and those of partnering lenders, as well as servicing Federal Family Education Loan Program (FFELP) loans taken out before July 1, 2010. Its wholly owned subsidiary, Aspire Resources Inc., provides customer service to borrowers with federally owned loans through the William D. Ford Federal Direct Loan (Direct Loan) Program on behalf of the U.S. Department of Education. Aspire also assists other state-based nonprofits with their federal loan allocations from the U.S. Department of Education.
Iowa Student Loan supports students and schools by providing innovative interactive solutions for their use as they apply for and process student loans. Iowa Student Loan reinvests its earnings in Iowans through vital programs targeted in the greatest areas of need. These include a financial literacy tool to help borrowers make loan decisions, benefits to U.S. service members, forgivable loans or grants to nurses and teachers who agree to work in Iowa; supplemental private student loans with interest rate and credit subsidies; and financial and in-kind support of the Iowa College Access Network® (ICAN), which offers free college planning services to students, parents and school counselors. ICAN operates as an independent nonprofit 501(c)(3) educational organization with its own board of directors.
Iowa Student Loan Products and Programs
Iowa Student Loan offers innovative products and services, developed specifically to best serve Iowa students and families.
- Student Loan Game Plan. Introduced in 2010, Student Loan Game PlanSM is a unique interactive tutorial to help borrowers understand the consequences of overborrowing and discover how to avoid borrowing too much in student loans given their likely future income. Using real salary data based on the majors specified by users, Student Loan Game Plan gives applicants, cosigners, high school students and general users specific information on possible debt and budget scenarios, as well as tips on how to reduce overall borrowing.
- Supplemental Private Student Loans. Supplemental private loan options, like the Partnership Advance Education Loan® and the Iowa Alliance Private Student Loan ProgramSM, that offer competitive interest rates and transparent terms are essential for students who have exhausted their other financial aid options and still cannot cover the actual cost of attendance.
- High-Quality Customer Service. In addition, Iowa Student Loan services both federal and private student loans, including programs offered by Iowa-area lenders. Borrowers consistently rate Iowa Student Loan high in customer service and in 2012 gave the company an aggregate rating of 4.4 on a scale of 1 to 5, where 5 is best.
Iowa Student Loan Reinvests in Iowans
Iowa Student Loan uses resources beyond what is required to fund its reserves to offer programs vital to Iowa students and families. Its board of directors works with policymakers, schools, lenders and other local partners to identify areas that are of the most critical need in Iowa. To directly impact these areas, Iowa Student Loan designs and supports local value-added programs and services, free college planning services, and loan forgiveness and grant programs.
Iowa Student Loan has operated loan forgiveness programs for nurses and teachers entering specified shortage areas. More than $4.7 million in forgiveness benefits has been paid to nurses and teachers in those programs, and payments to those in the programs are continuing.
In summer 2010, Iowa Student Loan replaced its loan forgiveness programs for nurses and teachers with grant programs. New teachers and graduate-level nurse education students may apply for cash grants in recognition of their work in shortage areas. Thus far, nearly $1.5 million has been awarded through these grant programs.
In addition, the Iowa Student Loan Armed Forces Interest Reduction Program recognizes service members who are or have been deployed during wartime efforts since Sept. 11, 2001. The program reduces interest to 0% on private student loans owned by Iowa Student Loan for up to 24 months for eligible borrowers in the U.S. Armed Forces. The program has provided more than $575,000 in reduced interest on private student loans held by U.S. service members.
Aspire Resources Inc.
Aspire Resources Inc.® (formerly known as ISL Service Corp.SM) is a wholly owned, taxable subsidiary of Iowa Student Loan. It was created to house Iowa Student Loan's activities that may go beyond its tax-exempt purpose, such as servicing federal Direct Loan accounts, reselling the computer software it develops or providing loan services to other student loan providers. Aspire's after-tax earnings go directly to Iowa Student Loan specifically to help the students that the company serves.
How Iowa Student Loan Differs from the Iowa College Student Aid Commission
Iowa Student Loan is a private, nonprofit corporation that receives no state appropriations. Iowa Student Loan finances student loans through bond issues and works with colleges, universities and financial institutions to make those loans available to Iowa students and their families. The organization services federal student loans and supplemental private student loans and works to help borrowers avoid default.
Iowa College Student Aid Commission
The Iowa College Student Aid Commission, by contrast, is a state agency that is a political subdivision of the state of Iowa. Under state statute, it administers the state's scholarships and grants and performs research for the governor and legislature. It also performs collections and other activities to help prevent defaults.