Choosing the Right Guarantor

In addition to choosing the lender for your student loan, you also have the right to choose the guarantor of that loan.

The guarantor is an organization that administers the Federal Family Education Loan (FFEL) Program on behalf of the U.S. Department of Education. Simply put, it means that a guarantor “guarantees” payment to the loan holder by agreeing to buy the loan if the borrower defaults. The MDHE Student Loan Program is Missouri's designated guaranty agency.

Why choose the MDHE as your guarantor?

• Choosing the MDHE, a state agency, is a decision to keep Missouri dollars right here in the Show Me State, helping to ensure that the state remains economically healthy. Unlike other guarantors, any earnings the MDHE receives from administering the federal student loan programs are reinvested into the state of Missouri and its citizens, not corporate shareholders.

• When choosing MDHE as the guarantor of loans held by MOHELA, borrower benefit programs reduce Federal Stafford and PLUS loan repayment interest by as much as 3 percent. MOHELA, Missouri’s designated secondary market and student loan servicer, offers the most generous repayment benefit package in the country, with deep discounts on interest rates as well as periodic loan forgiveness programs.