The beginning of student loans in the U.S. came with the Morrill Act for Land Grant Colleges of 1862. The U.S. Office of Education was started in 1867.
In 1944, the G.I. Bill brought funding directly to students (instead of schools) who were also veterans under the Serviceman’s Readjustment Act.
The National Defense Education Act was passed in 1958, which began to help students who were not veterans. The U.S. Office of Education ultimately became the U.S. Department of Education and there are two significant offices under this department:
- The Office of Federal Student Aid which sets up and secures Title IV Financial Aid programs.
- The Office of Postsecondary Education which is a policy-making office for programs to be implemented by the Department of Education.
The Direct Loan program was created in 1993 and is now known as the William D. Ford Federal Direct Loan Program.
In August 2014, the American Bar Association published opposition to the Department of Education FY 2015 budget proposal, that would potentially limit forgiveness of student loans, after ten years of public service, to $57,500 (or another cap amount to be determined) and would also require those with remaining balances to repay those amounts for up to 15 more years.
Today, student loan forgiveness is not limited to borrowers who are working in public service.