Student Loans: Improvements in the Direct Loan Consolidation Process

Pursuant to a congressional request, GAO provided information on the William D. Ford Federal Direct Loan Program's (FDLP) and the Federal Family Education Loan Program's (FFELP) loan consolidation process, focusing on: (1) whether FFELP lenders believe that Electronic Data Systems' (EDS) consolidation processing has improved since the December 1, 1997, reopening of the FDLP consolidation system to new applications; (2) the extent to which problems in the data transmission between EDS and the FDLP servicing system have been resolved; and (3) how quickly EDS has been processing consolidation applications for borrowers who applied after December 1, 1997, and whether the Department of Education believes EDS could promptly process a substantially greater inflow of applications.