The ongoing credit crunch has tightened the purse strings on current and future students seeking college loans.

More than 100 private lenders since last year have exited the Federal Family Education Loan Program, a network of private lenders that offer federally guaranteed student loans, said Deborah Fox of Fox College Funding, a national firm that helps parents obtain funding for their children’s college education.

“It is surprising to see actually what impact it had on the student loan industry, much more than I had ever figured could be the case,” she said.

The program was created by Congress in 1965 and since has provided more than $567 billion in low-cost loans to millions of students and parents.

The credit crunch has made it tougher for children of middle-income families who still need loans to cover college costs, said Greg Lane, certified public accountant and certified financial planner with Lane Financial in Scottsdale and Prescott.

“A lot of the usual lenders to students don’t have as much money to lend anymore because the credit crisis has cut down on the amount of capital that’s out there in the marketplace,” he said. “The people who aren’t financially strapped but still take out student loans, which is a huge percentage of the population of students, that’s where it’s real tight right now as far as their ability to get financing.”

Still, nearly 100 percent of people who apply do receive some type of financial aid, said Valerie Vigil, assistant director of financial aid at Mesa Community College.

“There’s something there for them,” she said. “It should not discourage anybody from applying because they may qualify for something.”

Federal financial aid hasn’t kept pace with rising college costs, so more students and their families are having to seek strictly private loans to make up the difference, Fox said. These loans should only be viewed as a last resort, she said.

In many cases, these loans have fewer consumer protections than federal loans and include variable interest rates, she said.

It’s always a good time for students to apply for grants and scholarships, said Karla Gonzales, scholarship coordinator at Mesa Community College. Many students may not even know these grants are available and that they qualify for them, she said.

“The Pell Grant, which is free funding from the U.S. Department of Education … has increased this year compared to previous years,” she said. “It’s a considerable increase, so we’re able to help a lot more students. In addition, there are other supplemental grant programs that are also available … both federal and state.”