Issue date: 8/26/08 Section: News

Media Credit: Alex Slitz Account Associate Melna Wilson (left) and Bursar Belinda Higginbotham of the Billings and Receivables office work overtime Thursday in Potter Hall. The two were sorting through 4,784 residual checks waiting to be disbursed to students.

Student residual checks weren't going to go out on time, but Western financial assistance employees showed up early to make sure students would get their money.

They began work at 4 a.m. on Thursday.

"Was that the morning or the middle of the night?" Loan Coordinator Nancy Alfonso said. "We're not really sure."

The staff worked overtime last week to make sure student residual checks were released on time after money for student loans was delayed.

Loans to pay tuition were expected to arrive on Aug. 15, but weren't available then, said Cynthia Burnette, director of student financial assistance.

Residual checks were sent out, as scheduled, on Aug. 22 because of a $50 million bridge bond from the state, she said.

The bond was put in place to get the loan process moving. It will be paid back when the federal loans become available. They are expected to arrive this week said Meredith Robinson, marketing support manager for the Kentucky Higher Education Assistance Authority and The Student Loan People.

Burnette said students use residual money to pay for books and living costs such as rent, so they tend to panic if their money doesn't arrive on time.

Parent loan residual checks will be released on Aug. 29, and students who borrowed from Edamerica, another lender, can expect their checks on Sept. 5, Burnette said.

Robinson said lenders are struggling because bond sales, which fund loans, have decreased.

Foreclosures in the housing market have hurt sales because mortgages are also backed by bonds, she said.

"We didn't do anything, but we got hit," Robinson said.

Lenders have never had to drop out before, she said.

Burnette said they will be less likely to stop lending next time because of the state's help this year.

Lenders may continue to need backing, but expect to be independent in about two years, Robinson said.

President Gary Ransdell said the state's bond was necessary this year, but is a short term fix.

Reach Christina Howerton at news@chherald.com.