One of the biggest players in federal student loan programs faces financial problems so serious that Education Department officials expect the nonprofit agency to collapse. Federal officials say five or six smaller agencies are experiencing similar, but less severe, financial troubles.

But the Bush administration denies that the difficulties in the guaranteed loan programs will add up to a major federal problem, one requiring the government to bail out these intermediaries just as failed savings and loan institutions have been. About $51 billion in loans, the largest source of college student aid, is outstanding.

"The numbers are big, but it is not an S&L situation. The federal liability is limited," one administration official said. "This is not a big federal bailout. It is not a federal bailout, period."

The Higher Education Assistance Foundation in Overland Park, Kan., is one of 55 guarantors of federally backed loans that banks make to students or their parents. The Kansas agency, known as HEAF, is one of the largest guarantors with a loan portfolio of $9.6 billion.

In the case of a default, the guarantor repays the bank, and then the government reimburses the guarantor between 80 and 100 percent, depending on that guarantor's default rate. HEAF has been receiving 80 percent from the government because a large proportion of trade school loans has pushed its default rate above 9 percent.

Education Department officials say the government would not be required to reimburse banks if HEAF or any other guarantor became insolvent. "There is no absolute guarantee," Undersecretary Ted Sanders said at a news conference yesterday.

Philip R. Rever, a HEAF vice president who runs its Washington office, has suggested that the guarantor could resolve its cash flow problems by borrowing from a private lender and getting the government to guarantee that loan.

Sanders said HEAF could take a loan if it can get one, but the government would not guarantee it. "I know of no mechanism whereby the department could guarantee such a loan," he said.

HEAF, which reported a $44 million loss last year and in recent weeks notified the department of continuing financial problems, repaid banks for defaulted loans on time this week, according to Rever.

Edward Stringer, general counsel for the Education Department, bluntly said HEAF's role as a guarantor would be ended if it misses any payments to banks. "When they {HEAF} can't fulfill that responsibility, they'll be terminated," Stringer declared.

Department officials yesterday suggested they expect that to happen. But Education Secretary Lauro F. Cavazos read a statement advising banks and students not to worry "in the event that HEAF does not survive."

"While HEAF's problems are serious to that organization, they do not threaten the integrity of the nationwide guaranteed student loan program or the loans now guaranteed by HEAF. Loans now guaranteed by HEAF will continue to be guaranteed," Cavazos said.

More specifically, Sanders predicted "another entity or entities" would probably assume the roles of HEAF, the designated guarantor in the District. "Under the scenario we're talking about here, HEAF would not exist," he said.

A statement released from HEAF's executive offices in Kansas said the guarantee agency was "pursuing on its own additional options" with "a variety of parties." The statement described a solution, not specified, as imminent.

If HEAF collapses, an administration official estimated it would cost the government a maximum of $60 million this year. "HHS burps more money in the morning than this is going to cost," the official said, referring to the massive Department of Health and Human Services.

A task force of nine accountants and computers specialists from the Education Department are reviewing HEAF's operations in St. Paul, Minn., where it has operations and administrative offices. Two officials from the Office of Management and Budget are also there.

Sanders said department auditors were also investigating the financial status of five or six smaller guarantors, whose combined loan portfolios he said totaled less than half of HEAF's $9.6 billion. He declined to identify those guarantors.