Student Financial Aid News
From Inside Higher Ed:
California’s community colleges could soften the projected blow to their budget by tripling tuition with no net impact on most students, says a new report by the nonpartisan Legislative Analyst’s Office. In-state residents currently pay $20 per course credit, making California the cheapest state in the nation in which to attend community college. A typical class is three or four credits, totaling $60 to $80. According to the report, state and federal financial aid would offset tuition increases of up to $60 per credit. …

Financial Aid News 142: Finding your student loans
From NASFAA:
“Beginning July 1, the majority of families who hold federal Stafford, Grad PLUS or Parent PLUS loans will receive notices that their loans have been bought by the Department of Education, says Sam Nelson, director of client relations for the Illinois Student Assistance Commission,” Bankrate.com reports. “‘To help lenders stay in the student loan market, the federal government is buying on the secondary market and servicing the loans themselves,’ says Nelson. ‘Six out of every 10 student loan dollars are now made …

By JOSEPH MARR CRONIN and HOWARD E. HORTON
The public has become all too aware of the term “bubble” to describe an asset that is irrationally and artificially overvalued and cannot be sustained. The dot-com bubble burst by 2000. More recently the overextended housing market collapsed, helping to trigger a credit meltdown. The stock market has declined more than 30 percent in the past year, as companies once considered flagship investments have withered in value.
Is it possible that higher education might be the next bubble to burst? Some early warnings suggest …

Student Financial Aid News
Federal student loans prior to July 1, 2006 used to be variable rate loans. Stafford loans issued before that date were set at the price of the 91-day Treasury Bill (T-bill) rate for the last auction in May of each year + 1.7% for loans in grace, 91-day + 2.3% for Stafford loans in repayment, and PLUS loans were set at 91-day + 3.1%. In 2005, overreacting to temporarily high interest rates, Congress mandated that Stafford loans after July 1, 2006 would be set at a fixed …

Student Financial Aid News
From Inside Higher Ed:
Education organizations received $40.9 billion in donations in 2008, down about 5.5 percent from the previous year, according to “Giving USA,” an annual report on charitable giving. Donations to all charitable organizations were down from individuals (always the largest source of gifts), bequests, corporations and foundations. For most colleges, these national figures will come as no surprise.
Commentary
I’m honestly surprised the drop in giving wasn’t greater. That said, that means there’s about 5.5% less scholarship money out there. More students are competing for the same …

Student Financial Aid News: Nursing scholarship, saving money on tuition
From the Chronicle:
Seventy-one percent of high-school guidance counselors this year saw an increase in the number of their students who chose a more-affordable option over their “dream school,” according to a survey released today. The survey of high-school counselors was released by the National Association for College Admission Counseling, along with a companion survey of college admissions offices.
Commentary
I’m very pleased to see that students are making more prudent financial choices. Hopefully, continued pricing pressure on colleges will encourage schools to rein …

Student Financial Aid News
From Forbes:
Borrowers drowning in high student loan debt will be thrown a life preserver on July 1. That’s when a new program is scheduled to begin that will allow former students to make monthly payments based on how much they make, rather than the amount they owe. The option to pay based on your income may sound promising, but there are a few catches… income-based repayment will only be available for federal student loans that are in good standing. Under this plan, borrowers’ monthly payments will be …

Student Financial Aid News
From NASFAA and CNN Money:
“Banks that took billions of dollars in taxpayer aid clamped down on credit during the month of March, according to a Treasury Department report published Monday,” CNNMoney reports. “In its first broad-based view of lending activity of the 500 financial institutions that received money under the agency’s Capital Purchase Program, the Treasury said the total amount of loans outstanding contracted by 0.8% in March to $5.24 trillion from $5.28 trillion in February. The report, which included everyone from smaller community banks to major …

Student Financial Aid News
From US News & World Report:
Many college savings plans have been hammered by the same kinds of investment bubbles and scandals that other investment plans have faced in the past year, causing thousands of Americans to halt their contributions to college savings and a few to file lawsuits alleging they were misled. Oregon’s “Conservative” 529 option, which lost more than 30 percent of its value in the 12 months that ended March 31 because OppenheimerFunds put some of the money into derivatives. Pennsylvania’s “guaranteed” college savings plan, …

Student Financial Aid News
From the Monitor:
“In the biggest financial crisis since the Great Depression, Fulton and her fellow students find themselves facing a tricky financial matrix: As job opportunities dwindle, their rent and grocery bills are high, their student loan and credit-card interest rates are climbing, and a night out costs so much that they stay home. Accustomed by culture and habit to immediate gratification, the Millennials have tools most of their parents didn’t, like credit cards. And now they’re paying for them with “just-swipe-it”-induced debt. Eighty-four percent of undergraduates …