The College Blog

We apologize to all of you who have or would have signed up.  We are re-scheduling for next Thursday, 8-14 and will include a special bonus for your inconvenience. 

Reecy will be the focus of a FREE teleseminar Thrusday, Aug. 7th.  Get the details here.  Learn legal secrets to qualify for maximum financial aid and how families can appeal unappealing financial aid offers!

Reecy Aresty, president of College Assistance, Inc., an admissions/financial aid services company in Boca Raton, FL, announced today that he will be concentrating his efforts and financial aid expertise to assist MA families caught up in this latest loan snafu.  Families are encouraged to send an email to reecy@paylessforcollege.com or call him for a FREE consultation at: 561.353.4000.   

 In a sincere effort to make college more affordable, President Lyndon B. Johnson signed the Higher Education Act of 1965 allocating billions of dollars for low interest student loans. It is fair to say that the Johnson Administration could not have foreseen that their good intentions would actually lead to an escalation of college tuitions past the $50,000 mark!

In the same manner that insurance coverage has lead to obscene medical costs, the government’s federal aid for higher education has clearly fueled the tuition fires with no end in sight. America’s colleges and universities were given one of the greatest gifts a capitalist society can bestow – the opportunity to profit far beyond their expectations of the day – and they have capitalized on it to the tune of billions of dollars.

Read the rest of this entry »

Reported in Marketwatch

Student loan borrowers who commit to a decade of public service may see the remaining balance on their federal student loans forgiven under the government’s new public-service loan forgiveness program.

Borrowers who enter public-service fields such as law enforcement, public education, or certain nonprofit work could have their remaining federal student loan debt forgiven, provided they work full-time for 10 years in an eligible public-service field and make 120 monthly payments on their college loans during that time.

To be eligible for the loan forgiveness program, borrowers must have taken out student loans, parent PLUS loans, or a federal consolidation loan through the Department of Education’s federal Direct Loan Program. Borrowers who took out their federal student loans from a private lender through the Federal Family Education Loan Program (rather than directly from the government through the Direct Loan Program) will have to consolidate their FFELP student loans into the Direct Loan Program in order to qualify for the loan forgiveness benefit.

The public-service loan forgiveness program is a provision of the College Cost Reduction and Access Act of 2007, which also increased federal grant aid to needy students and was intended to provide student loan borrowers with the incentive to consider and continue working in often low-paying public-service fields.  For the rest of the story, click here.

Pay Less For College, an interactive radio show, will debut Sunday, July 20 at 10:00 AM EDT on WNJC 1360 AM, stream on the Internet at wnjc1360.com, and shows will also be archived at Paylessforcollege.com.  Reecy will answer listeners questions and explain the ins and outs of the college admissions/financial aid process and reveal what the colleges, the states, and the feds don’t want families to know.  Every show will deal with a specific topic and follow his College Funding Timeline.   Listeners are encourged to call 856-227-1360.  Talk to you soon.

Reported by Adam Clark - The Daily Collegian Online

The Penn State Board of Trustees on Friday approved a 5.9 percent increase in tuition for the 2008-09 school year, the highest increase since 2005.

Still, “our tuition increase is going to be below the average of similar institutions,” Penn State President Graham Spanier said during a presentation during Friday’s board meeting. “I’m very pleased that we were able to keep it at a reasonable level, given the very modest appropriations.”

Penn State received a 1.2 percent increase in state appropriations this year. The trustees had recommended a 6.9 percent increase in state appropriations last September.

“With the state appropriations being low, I think it’s been obvious for a number of years that Pennsylvania, as well as some other states, are moving towards a tuition-driven formula,” Vice President for University Relations Bill Mahon said.  For the rest of the story, click here.

Reported by Gil Kaufman - M TV

Ohio GI Promise essentially grants vets full scholarships at state’s public schools.
Just a week after President Bush signed off on a new GI Bill that essentially guarantees veterans of the Iraq and Afghanistan wars full scholarships at their home state’s public colleges and universities, Ohio has upped the ante by announcing that it will offer in-state tuition rates to those who attend college in the Buckeye State.

According to The New York Times, the Ohio plan, called the Ohio GI Promise, is the first of its kind in the nation. It will make all veterans “honorary Ohioans,” changing residency requirements at the state’s 36 colleges and universities to allow veterans, their spouses and dependents to attend at in-state tuition rates, regardless of where they currently reside.  For the rest of the story, click here.

New rate schedule follows:

The above chart is for subsidized loans only; unsubsidized Stafford Loans remain at 6.8%.

Reported in the Memphis Business Journal

Tuition and fees at Tennessee colleges and universities will increase 5.85 percent in 2008-09, according to the Tennessee Independent Colleges and Universities Association.

For the 2008-09 school year, the average published tuition and fees for undergraduate students attending a TICUA member private four-year institution in Tennessee will be about $18,000 per year. Last year, students attending four-year private institutions in Tennessee paid 28 percent less than the national average of $22,218.

TICUA also reports that 88 percent of first-time, full-time students attending private colleges and universities in the state receive some form of financial support; 37 of its member colleges and universities provide over $318 million in grant aid to students attending private colleges.  For the rest of the story, click here.

The Univ. of MI is hard up for cash, so they will raise tuition and fees for the fall term by 5.6%.  Stay tuned for the latest info on your favorite schools.

Reported by Amy Rolph - Seattle Post-Intelligencer

The University of Washington Board of Regents approved two controversial changes for the state’s flagship university Thursday — one that will have some students reaching deeper into their wallets and another that already has divided faculty in science departments.

The regents voted to raise tuition 7 percent for most students starting this fall — an increase of more than $400. They also decided to move forward with the creation of a College of the Environment, an umbrellalike school that would group existing science-related programs that deal with environmental issues.

The tuition increase was predictable, given the university’s history of similar increases.

Approval of the environmental college wasn’t quite so certain. Though students still will be able to earn degrees from the schools that exist under the College of the Environment banner, several schools that would be included in the college have opposed the plan.  For the rest of the story, click here.

Reported by Janet Frankston Lorin - Bloomberg

A U.S. program to support college lenders is ensuring that students will get the government-backed financial aid they need for the 2008-2009 academic year, after a seizure in the credit markets threatened the flow of funding.

At Michigan State University in East Lansing, 6,042 students have received $26 million in federally guaranteed loans since early May, said Val Meyers, associate director of financial aid, in an interview on June 6. SLM Corp., the largest U.S. provider of education loans, said yesterday it is committed to providing aid to “every eligible” applicant this year.

Financing obtained for summer classes and reassurances from lenders have made college administrators confident that students won’t be denied funds, said Judith Carter, financial aid director at Dickinson College in Carlisle, Pennsylvania. Aid officers at Fordham University in New York, Trinity University in Washington, and Smith College in Northampton, Massachusetts, also said in interviews that they anticipate no shortage of money even after dozens of private companies abandoned the business this year.  For the rest of the story, click here.

What most families don’t realize is that the economic stimulus check they may have already received was nothing other than a return of their own money!  Depending on how much you actually paid???????? in taxes, you may have or will soon receive a check from Uncle Sam.  If you got a refund for 100% of what was withheld, then the stimulus check will actually come from the US treasury. 

Don’t spend it all in one place, or simply put it into a 529 Savings Plan; you may need it to drive to the grocery store, but don’t buy any tomatoes!

On May 7, 2008, President Bush signed into law the Ensuring Continued Access to Student Loans Act of 2008, which was supposed to quell panic in the student loan crisis. However, in reality, it did nothing more than add fuel to an ongoing fire by ensuring that the colleges and lenders will benefit at the expense of students and their families.

The new law follows on the heels of the Higher Education Reconciliation Act of 2005 (HERA), and should be re-titled the Ensuring Continued Increases to Student Loans Act! 
Under the guise of aiding college families overwhelmed by the student loan crisis, all it did was to perpetuate another deception on the academic public, typical of this administration.  Here’s how these laws play out:

• Beginning in school year 2007-2008, HERA increased Stafford Loans for freshmen from $2,625 to $3,500 and from $3,500 to $4,500 for sophomores.  Need-based aid recipients lost $1,875.  Not too bad, but it gets worse.

• Colleges benefited by reducing their own aid accordingly and lenders will prosper from the increased loans.
 
• Beginning in school year 2008-2009, the new law increased Stafford borrowing power for undergraduates by $8,000 ($2,000/yr for 4 years).  Colleges will now save up to $9,875 per student in unawarded need-based aid (scholarships and grants), and lenders will be handsomely rewarded with more interest from larger loans.

This new act is nothing more than a “wolf in sheep’s clothing” everyone, not just college families, should write their congressmen and demand a repeal of this deceptive legislation.  It’s inconceivable how the media has lauded this bait ‘n switch, when it’s so obvious that the only beneficiaries are the colleges and the lenders?  Only time will tell if the media alerts the public that they indeed have been swindled.

This administration promised no child left behind - and they weren’t.  They’re just guaranteed to graduate college deeper in debt than at any other time in history!

UM jumps the gun on new Stafford Loans

Two weeks before President Bush signed H.R. 5715 into law, Miami’s financial aid office had already cranked up the presses and doled out non-existent federal student aid. The new law enables undergraduates to obtain an additional $8,000 ($2,000/yr for four years) as an unsubsidized Stafford Loan.

A full 2 weeks before the Senate had even voted on it, Miami awarded a student an unauthorized Stafford loan rather than a Grant or scholarship, saving themselves $2,000!

The net result of this legislation is that colleges, UM included, will save millions on grants and scholarships; lenders will receive millions in additional interest, and students will graduate deeper in debt.

I’m cautioning all families to review any financial aid offers dated prior to May 7^th, the day President Bush signed H.R. 5715 into law, to determine if a college is guilty of this illicit practice. If so, they should have the school withdraw the loan offer immediately and demand a scholarship or grant in its place.

Sadly, the college loan scandal continues…

Additional aid can be obtained before school starts.

By now, you’ve received your award letter, and thousands of families are unaware they can be challenged.  I’m a 29 year veteran of financial aid trench warfare and have been extremely successful at enhancing what many perceive is a lost cause - an appeal.

Here are a few of my guidelines for an appeal letter:

• 2008 income and/or assets will be substantially less than 2007
• Death, divorce, job loss, or excessive health bills in 2008
• Pell Grant recipients could be entitled to an SEOG, (Supplemental Educational Opportunity Grant), max is $4,000; an Academic Competitiveness Grant, max is $750; and/or a SMART Grant, max is $4,000
• Federal Work-Study awards can be as much as $4,500
• Need-based aid can include a Perkins Loan up to $4,000
• Subsidized Stafford Loans have been awarded to families with adjusted gross incomes in excess of $125,000
• Students from the South attending northern schools have obtained winter clothing allowances for as much as $2,600
• Travel grants can be as much as $1,500 if attending cross country

The prescription for success entails having the student write a compelling letter to whomever sent the award.  If the sender isn’t named, seek out the director and mail it to his/her attention. Never ask for money, always ask for help in making the school affordable.  Under no circumstances call the school, as it’s far too easy for them to simply say, “We’re sorry, there is no additional aid available.

If a family doesn’t wish to go it alone, I am offering a free consultation to discuss your unappealing financial aid offer…  Send an email to reecy@paylessforcollege.com or call 866.346.7890.  Good Luck no matter what!

Two students who I counseled will join the Class of 2012 have been shortchainged in their financial aid packages.  Harvard ignored the 10% rule and overcharged one family $750.  Per my instructions, the other family appealed and received an additional $6,000 of financial aid!  What if they hadn’t!  If there are any Crimson students out there who would like a free review of their financial aid offer, please contact us ASAP!

In 2007, the College Cost Reduction Act (H.R. 2669) increased both the Pell Grant (benefiting students) and the Stafford Loan (benefiting colleges & lenders).  While there are far more Stafford borrowers than Pell recipients, the rich got richer at the expense of those less affluent.

Now, in May, 2008, the student loan crisis is taking another turn which will be reinforced by federal legislation, the Ensuring Continued Access to Student Loans Act of 2008 (H.R. 5715).  Once again, to no one’s surprise, the big winners are the colleges to the tune of $8,000 per student borrower. 

President Bush just signed legislation that has been passed by both the House and Senate, and it will simply add fuel to the fire and make the student loan crisis that much worse. 

H.R. 5715 takes away $2,000 per year of “free money” from families who qualify for need-based aid. Increasing the Stafford Loan by $2,000 per year will benefit the loan providers with additional interest and bring a windfall to the colleges of up to $8,000 per student.
 
Here are 2 possible solutions:

• Families need to be educated on how to legally qualify for maximum financial aid in the first place, and
• A federal grant is crucial for families who qualify for need-based aid, but whose income is too high to qualify for a Pell Grant

Sallie Mae announced that it would no longer offer consolidations under the federally guaranteed loan program. Students typically consolidate their loans after they graduate, combining loans from each of their years in college into a single loan to make it easier to manage when paying back the money, assuming there is a better loan rate.