Financial Aid

3 Dangerous Student Aid Myths

What higher education leaders can do to debunk them

Unless you live in a cave, you’ve seen the alarming headlines highlighting “exploding” college costs and “crushing” student loan debt. Because the media is trying to grab readers’ attention, these articles often use the most startling cases of these serious problems without providing context needed to fully understand the complexity of these issues. A simple internet search reveals the prevalence of these types of articles. Here are just a few recent headlines:

Too Little, Too Late

Illinois suspends financial aid award program early

In the midst of the debate in Congress over whether or not to double interest rates on Federal student loans in July comes another hot-button aid issue—states are running out of aid money altogether. At the end of March, the Illinois Student Assistance Commission (ISAC) announced it would need to suspend making Monetary Award Program (MAP) awards for FAFSAs filed on or after March 14.

How Student Loan Services Impact the College Experience

Why universities that pick the right partner keep students in class and on track

As new high school graduates anxiously await acceptance letters from their favorite colleges, many will start to plan for this new chapter in their lives by seeking student loans and financial aid to pay for it. After running the gauntlet of qualifying for loans and assistance, many will forget all about it.

Double Trouble

Looking for a long-term solution to federal student loan interest rates

The roughly 9 million students who rely on subsidized federal loans will see interest rates double from 3.4 percent to 6.8 percent on loans borrowed after July 1. It’s just the latest chapter in the nearly 50-year saga of the federal government trying to determine the appropriate rate for these loans.

The Obama administration has urged Congress to extend the 3.4 percent rate for one year, but an extension would cost an estimated $3.9 billion. Students and parents trying to plan and pay for college face confusion and uncertainty.

It’s Official: Students Need Financial Aid

A new analysis of U.S. Department of Education data by the National Association of Independent Colleges and Universities quantifies the reliance on federal student aid by students in every state and congressional district.

Interest Clock is Ticking

Time is running out for Congress to take action to stop a scheduled interest rate increase on Stafford loans this summer. In July, interest rates are set to double for almost 8 million students. The average subsidized Stafford loan borrower will pay an extra $2,800 on their loans, and students borrowing the maximum $23,000 in subsidized loans starting next year would pay almost $5,000 more over a 10-year repayment period.

Graduate Financing Options for 2011-2012 and Beyond

Stafford Loans

  • Subsidized Stafford loans are available based on financial need, and unsubsidized loans are available to everyone. 
  • For graduate students, the maximum annual loan limit is $20,500 (with up to $8,500 subsidized). The aggregate loan limit, including undergraduate debt, is $138,500, except for medical students, for whom the limit is $224,000. 

Piled Higher & Deeper

Graduate student debt runs out of control.

Student borrowing is going up. National Student Loan Data System data shows that cumulative borrowing per student participating in federal loan programs increased from about $3,943 in 1990 to $11,510 in 2000 and $13,856 in 2009. Much of the increase is attributed to funding for graduate education, and recent changes in federal student loan policies for graduate students will likely cause this to go higher.

Saving Pell

How Congress maintained the $5,550 maximum Pell Grant

The time of unprecedented growth for the federal Pell Grant program couldn’t have come at a worse time for Congress. As lawmakers were looking to cut federal spending to address the growing national deficit, record college enrollments, the economic downturn, and expanded Pell Grant awards and eligibility criteria combined to triple the cost of the program over five years.

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