The resumption of the city's multi-million-dollar, low-interest student loan program hasn't meant that loans are any easier to obtain for students who attend schools outside the metropolitan area.

Would-be borrowers have found that new loans are available only to city residents who attend schools in the District of Columbia, Maryland or Virginia. Under the old loan program, which was abandoned two years ago because of defaults in excess of $4 million, students were eligible for loans no matter where they went to school. Renewal borrowers (those wishing to acquire additional loans) are not bound by the new "in-area" attendance requirement.

Frazier Scott, chairman of the nine-bank D.C. Federal Student Loan Consortium, explained the rationale for the restriction. "We have a limited amount of money going to a limited number of students in a limited trade area," he said. "It's like covering a wheat field with just so many grains of wheat. It's a difficult thing to do, but we've tried to be as equitable as possible."

Howard Krocoff of the U.S. Office of Education said there is nothing improper or illegal about a private lender setting restrictions on loan eligibility. "A lender can haev whatever rules and regulations he sees fit," Krocoff said. "We encourage them not to make restrictions. We wish they wouldn't but there is nothing we can do about it."

Consortium officials said they have been flooded with calls from parents and students complaining about the "in-area" attendance requirement. "I think it's ousy," said Barbara Schlegel, whose daughter will enter West Virginia University this fall. "We've lived in the District for over 20 years. My husband even works for the city. And what do we get? Nothing."

Washington banks started granting student loans again on June 1. An agreement was reached earlier this year whereby the banks said they would resume the loan program if the city and federal governments promptly paid off the $4 million in defaulted loans. All future loans will be completely guaranteed by the federal government.

To qualify for a first-time loan under the new program, a student must attend a school in the metropolitan area and be a resident of the District for at least 18 months, said consortium official Gail McCarthy.

McCarthy had more bad news for first-time borrowers. She said her office already has approved virtually all of the $1 million in loans set aside this year for first-time borrowers.

She suggested that those still interested in loans seek them from any one of the following lenders: the National Bank of Washington, credit unions (loans available for members), savings and loan associations (loans available for depositors) or the Knights of Columbus (loans available for associated families). For the names of other potential lenders in the metropolitan area, she recommended calling the U.S. Office of Education's regional branch in Philadelphia at (215) 596-1073.