ConSern can help with college fees - private-sector educational loans

Nation's Business, Feb, 1988 by Harry Bacas

Whalen says: "I have been intimately associated with higher education for 15 years. And I saw a growing need for additional money that students had to have just to go to school. I wanted to make it possible for people to go to school."

He persuaded the university consortium to set up an independent organization, University Support Services, to run the program. He went to Wall Street and persuaded Shearson Lehman Brothers to agree to market the commercial paper that would finance the project. He signed up the National Bank of Washington to make the loans (most of which would be quickly repurchased by ConSern). He got the Continental Insurance Company to insure against loan defaults and Wachovia Services to service the loan repayments.

Then he persuaded the Washington Board of Trade to sponsor a pilot loan program for Washington businesses. It was so well received that last fall ConSern decided to go national.

Christine Salerno, Kathy Stachon, and Fletcher and Elizabeth Hanson were among the first recipients.

Salerno is one of four children. Her father works for Niagara Mohawk Power Corporation in Albany. He helped put her through Zion Bible Institute in Barrington, R.I., where she earned a diploma. Last fall she transferred to Southeastern to earn a bachelor's degree in order to teach elementary school.

The first-year cost of $4,800 at Southeastern was more than she and her father could manage, and she was turned down for a government loan. Then she learned of ConSern through the school's financial-aid office. She applied and received a $4,000 loan; she is the borrower and her father is cosigner.

"It was my financial responsibility," she says. She now makes monthly payments of interest, using earnings from her $3.35-an-hour fast-food job, where she works weekday evenings 10 hours a week.

After she finishes school she can take up to 15 years to repay the loan or pay it off early without penalty.

Christine expects to marry before graduation; her fiance is also at Southeastern. She thinks she may teach a few years, pay off the loan and stop working after she has a child, "because my place will be in the home."

Kathy Stachon, in Des Moines, already has a bachelor's degree--in health education, from Utah State University in 1980. There she met and married Richard Stachon, who went on to earn an M.B.A. from Creighton University, in Omaha. He joined Shearson Lehman Brothers as a stockbroker. His job has taken them to places where Kathy couldn't find work in her field. And Zachary was born in 1986.

Kathy decided to get another degree that would enable her to teach elementary school. The nearest suitable school was Iowa State, in Ames. It would take two years and cost $10,000.

One day Richard came home from his job at Shearson with news of ConSern, and Kathy decided to enroll this year. Shearson was sponsoring the student-loan program for its employees and would pay half the loan discount points.

The couple got a $10,000 loan to cover two years' tuition, books, supplies, child care and a 6-year-old car to get Kathy to and from school.