Officials are skeptical of the White House proposal to overhaul the $12-billion-a-year student loan program and doubt it will pass.

This process would bypass banks and have the government offer loans directly to students.

“I doubt seriously that it will ever happen,” said Jerry Augsburger, NIU financial aid director.

“If pushed by the administration in congress, the bankers’ lobby will get out guns against it,” Augsburger said. “The banking industry will not want to lose the student loan business.”

The government says the move will simplify the loan process and could save taxpayers $1 billion a year by eliminating the subsidies paid to banks.

However, many authorities are worried that the government will not put the money back into the loan system.

They also fear that the government might eliminate the interest it pays on loans while the students are in school. This elimination would make students responsible for the interest after graduation instead of the government.

Bypassing banks also will place more responsibility on colleges. “Loans going through institutions would require more work on our part and schools would need expanded staffing,” Augsburger said.