When it comes to federal student loans, the program under which you obtained them can make a difference. When you look at your loans in the National Student Loan Data System (NSLDS), you might be wondering what FFEL and DL mean. Fortunately, the answer is simple.

FFEL is the Federal Family Education Loan program. Under that system, a private bank would originate the loan with a federally designated Guarantee Agency (GA) to back it up. Should the loan go into default, then the bank would put in a claim for payment, and the GA would "buy" the loan. From there the GA would assign it to a collection agency.

The William D. Ford Direct Loan program originates the loans directly, rather than private banks. Should these loans go into default, they go directly into collections. In July of 2010, the FFEL program was discontinued.

This difference can come into play for you in two ways: 1) In what payment plans are available; and 2) in how you get out of default. Therefore, it is important to know which of your loans are in which of these programs when you set out to do either of these. Learn more here.

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Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.