This week's quotes focus on the state of the economy and its implications for the financial aid office:
"CSN [College of Southern Nevada] Financial Aid Director Peter Hurley says their applications are up 82-percent from this same time last year. If
this trend continues, they're expecting 35,000 students to apply for
help for next year putting a strain on their work study programs and
grants. "It can only go to so many people and make a
difference. I can't give everybody $5 and expect to have a positive
impact on enrollment," said Hurley."
I received the following update today from a financial aid administrator at a public university:
Our 3rd quarter private [loan] approval
rates were down about 5% overall from this time last year, with overall
private volume down about 35% from this time last year. Only one private lender partner approved over 50% of loan applications, and one lender only approved
15% of applications. These figures
and trends certainly don't bode well for students relying on private
funding for summer, and consequently then trying to register for fall
while still scrounging to get approved for
a private student loan to cover a prior year balance.
I think the
increased undergraduate
Stafford borrowing limits
and increasing utilization and awareness of
Grad PLUS account for a good share of the volume drop (which is
great for the borrowers), but approval
rates are worrisome since I think "students"
are just now starting
to truly "feel" the credit
crunch in terms of private student
lending.
The focus of this week's column is how financial aid offices are assisting students who have seen their financial situation change during this recession:
Karen Rice, associate director of financial aid at the University of California at Berkeley,
says you also should not hesitate to ask questions of the financial aid
office of the college your child decides to attend if your financial
situation worsens during the aid process.
Note: 1Q08 data reflects period from 1/1/08 to 3/30/08 while 1Q09 data reflects data from 1/1/09 to 3/29/09. -------------------------------------------
I have listed the key findings of this report, which was last completed by Nellie Mae in 2004.
Key findings:
In this time of credit crunch and economic downturn, college students are relying on credit cards more than ever before. Nearly every indicator measured in spring 2008 showed an increase in credit card usage since the last study was conducted in fall 2004.
Eighty-four percent of undergraduates had at least one credit card, up from 76 percent in 2004, the last time the study was conducted. The average number of cards has grown to 4.6, and half of college students had four or more cards.
Undergraduates are carrying record-high credit card balances. The average (mean) balance grew to $3,173, the highest in the years the study has been conducted. Median debt grew from 2004’s $946 to $1,645. Twenty-one percent of undergraduates had balances of between $3,000 and $7,000, also up from the last study.
I came across this article in the Collegiate Times which mentioned that Virginia Tech would be awarding returning students in April next year rather than June which is their current practice. The article highlighted some of the challenges faced in developing award packages that early:
"The trade-off is that packages are conditional on a number of factors.
Awards are based on estimations of tuition and fees. If the estimate
is off, the award must be revised. If the student does not show
"reasonable academic progress" when grades become available, their
offer may be rescinded."
Are other schools considering similar moves to provide clarity on award packages to returning students sooner in the process?
Here is a description of the station's programming:
Countdown to College Radio is a weekly one-hour live show dedicated to
helping college-bound high school students and their families
understand the process of getting ready for - and getting into -
college. Show host Beth Pickett interviews the experts on the college
application process, high school coursework, summer opportunities,
extracurricular activities, application essays, standardized testing,
financial aid, and college options.
To access the station, go to CountdownToCollegeRadio.com
to listen on the computer or to download to an MP3 player. The show also offers a free weekly newsletter to see what's new in
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"We have seen such a huge increase in the
number of eligible Pell Grant applicants that we actually went beyond
what we thought we would," Tom Bilbruck, director of financial aid and
scholarships for the College of the Canyons, a community college, said.
The school has seen a 52-percent increase in the amount of Pell Grant funds given to students.
But the difficult economy remains on the minds of college admission officials. “Will people be able to afford it?” Shorb [Robert Shorb, associate dean and director of student aid and family finance at Skidmore] said. “It’s a real different climate.”
