Credit crunch puts squeeze on FAMU students

The economic turmoil affecting the U.S. is having a ripple affect on some unsuspecting FAMU students.

EdAmerica, one of the two lending agencies, that FAMU uses for student loans, has seen its cash flow curtailed and is struggling to come up with the fund to provide FAMU to disburse to students. The University became aware of the problem in mid-August and asked the company to email the FAMU students its provide loans to inform them of the problem directly.

" In October, EdAmerica is still over extended and providing conflicting information to FAMU students and financial aid office staff," said Financial Aid Director Marcia Boyd. "In one case, EdAmerica has told students that funds will be released in three to four weeks, but told us (Financial Aid) that that they will be released in 10 days," Boyd wrote in a letter to the editor published in the FAMUAN.

Late applicants affected
"Students who applied on or before our priority date have received their funds," Boyd wrote.

It's believed that about 400 FAMU students have been caught up in the crisis. Most of all of these students are "late filers".

FAMU's other lender, Regions Bank, hasn't been affected as much EdAmerica who's sole business is student loans.

FAMU isn't only school affected
EdAmerica customers through out America are feeling the pinch as the giant student loan agency has seen its source of funds to provide students dry up.

The situation is an outgrowth of the global credit crisis and an indirect effect of the glut of bad mortgage debt weighing down the financial industry.

Laura Bower, a spokeswoman for student lender Edamerica, said the company has yet to fulfill agreements with several institutions but expects to do so this month.

Other colleges have stepped in and provide emergency loans to some students caught up in the crisis.