Current credit crunch leads to tighter standards for your student's loans

These Wall Street struggles could make it harder on college students trying to borrow money. Many lenders, like Sallie Mae, are now tightening their credit standards, so fewer people are qualifying for private loans. But as KLTV 7's Courtney Lane explains, Congress is taking action to help students and parents afford their college education.

Dianne Elliott is a single mom of four. Her youngest is still in college, and paying for that degree is tough.

"My son actually, they sent me a bill for 40,000 dollars," said Elliot.

It's the story of countless east Texas families, but now, with the credit crisis on Wall Street, it's even harder to get financial help.

"The economy is to the point where they're being scrutinizing people more as to their assets and credit-worthiness of the individual."

Pam Rodriguez is the college advisor at John Tyler High School. She encourages students and parents to start planning early.

"That could be in third grade, kindergarten. There are many scholarships available believe it or not," said Rodriguez.

"I know now what I didn't know then...that you have to start early. You have to start early," said Elliot.

Rodriguez also says there are plenty of resources to apply for, some you may not think about.

"There are tax benefits also that parents can take advantage of if they'll talk to their accountants or tax-preparers they can tell them what they're eligible for."

And this week the Senate passed a bill to help struggling students. The measure authorizes the Secretary of Education to buy loans from lenders if they're unable to meet demand. They say this way students can have access to loans despite the credit crunch.

You may be eligible for free money or loans at a low interest rate. That includes grants, as well as low- interest loans and work study programs. Even if your family saved for college, you may be eligible for some free or low interest money. The bottom line, you don't know what's available if you don't apply - so call 1-888-311-8881.

Courtney Lane, reporting.