Recent legislative changes to government student loan programs might open doors for more borrowers, but they could also increase the likelihood of borrower defaults, said Fitch Ratings last week.

On March 30, the House of Representatives passed the College Access and Opportunity Act of 2006, which rolls back the single-holder rule for consolidated loans, after July 1, 2006. The current single-holder rule requires a borrower to consolidate all of their outstanding loans with the lender that holds them, even if they could get a better deal elsewhere. The new rule says that student loan borrowers can shop around for the best deal, and consolidate all of their loans with one lender.

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