Saving for college

Higher Education Opportunity Act of 2008

hmoroz — Wed, 06 Aug 2008 15:56:11 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Percentage of dependent Pell Grant recipients whose family income is less than $20,000: 40

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 1986-1987 school year: 52

Percentage of tuition and fees (including room and board) at public four-year colleges that was covered by the maximum Pell Grant in the 2006-2007 school year: 32

Amount that the average college student pays for textbooks each year: $900

Average number of hours that the Brookings Institution estimates an applicant needs to complete the FAFSA: 10

Number of hours a year spent filling out financial aid forms: 100 million

Equivalent in full-time jobs: 55,000

Number of students who have not received financial aid due to drug convictions since the provision went into effect in 2000: 200,000

Overview/Summary

Middle Class Position Analysis

Middle Class Supports. Although a college education is increasingly a prerequisite for a middle-class standard of living, current and aspiring middle-class students and their families are struggling more than ever to afford college. Indeed, in recent years the maximum Pell Grant, designed to provide financially strapped students with an opportunity to attend college, has failed to keep pace with rising higher education costs. 2007’s College Cost Reduction and Access Act, which increased the maximum Pell Grant and limited federal subsidies to student lenders in order to increase college financial aid by $20 billion, was a necessary first step in making college more affordable. The Higher Education Opportunity Act’s additional increase of the maximum Pell grant will make college accessible to more aspiring middle-class Americans. Additionally, the expansion of the Pell Grant program to include year-round education supports the hardest-working students struggling to complete their educations quickly. Continued commitment to the TRIO and GEAR UP programs is critical to ensuring that first generation and at-risk students are able to obtain a college education and achieve a middle-class standard of living.

Skyrocketing tuition costs and large and confusing debt obligations can make college unaffordable and financial stability after college difficult. Indeed, the College Board reports that average tuition and fees at four-year public institutions have increased 51% over the last five years and that private undergraduate loans have grown from 3% to 12% of the funds used to finance postsecondary education since the 1996-1997 school year . The Higher Education Opportunity Act improves a student loan system that has been characterized by favoritism and murky lending practices. The Act will help put an end to the most egregious conflicts of interest and will expand and simplify the information that is available to students and their families when deciding what colleges to attend and what loans to take out. Ending such conflicts of interest will ensure that students receive the most affordable loans, not loans that are the favorites of an unethical financial aid officer. A simplified application form for federal student aid will ensure that students are not dissuaded from seeking financial assistance for higher education because of complex paperwork. Stricter reporting requirements for institutions that that fail to rein in tuition hikes are a positive step in influencing institutions of higher education to make college more affordable. Efforts to reduce the cost of textbooks will also be helpful to students struggling with high costs.

Quotes from Experts

Beyond this Bill

Additional Resources

Higher Education Project, from U.S. Public Interest Research Group

Window of Opportunity: Targeting Federal Grant Aid to Students with the Lowest Incomes, from the Institute for Higher Education Policy

Trends in College Pricing 2007, from the College Board

Ensuring Continued Access to Student Loans Act of 2008

hmoroz — Thu, 24 Apr 2008 15:36:42 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Minimum number of student lenders in the Federal Family Education Loan Program: 2,000

Percentage growth in undergraduate federal borrowing between 1996-1997 and 2006-2007 school years: 51

Percentage increase in the number of undergraduate subsidized Stafford loan borrowers between the 1996-1997 and 2006-2007 school years who do not have to pay interest on their loans while attending school: 47

Percentage increase in the number of undergraduate unsubsidized Stafford loan borrowers between the 1996-1997 and 2006-2007 school years who must pay interest on their loans while attending school: 113

Percentage of total funds used to finance postsecondary education composed by private loans in the 1996-1997 school year: 3

Percentage of total funds used to finance postsecondary education composed by private loans in the 2006-2007 school year: 12

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. With 66% of students at four-year colleges holding student loan debt, the credit crunch has generated concerns that aspiring middle-class and middle-class college students and their parents will be unable to obtain the loans they rely on to afford college. Federally backed student loans, which are cheaper than private student loans, provide these students with a financial gateway to higher education. Increasing the amount of Stafford loans that students are able to borrow would help students cope with tuition costs that they would otherwise have to fund with more expensive private loans. The delay in PLUS loan repayment authorized by the bill, along with the exemptions for delinquency on mortgage and medical bill payment, recognize that the declining economy in general, and the collapsing housing market and rising health care costs in particular, are squeezing many middle-class American families. In conjunction with the act’s other provisions, the authorizations of funding for lenders-of-last-resort and for purchases of student loans by the government minimizes the risk that the marketplace for federally backed student loans will collapse.

Quotes from Experts

Beyond this Bill

Additional Resources

Trends in Student Aid, from College Board

"House Panel Addresses the Would-Be Student Loan Crisis", from Inside Higher Education

Student Aid on the Web, from the Department of Education

College Cost Reduction Act of 2007

atraub — Wed, 26 Sep 2007 17:58:22 -0400

Legislation

The middle class

Supports

Video Summary

Injustice Facts

Total amount the average four-year college student with a subsidized Stafford loan would save under this bill if they start school in 2011, when the cut is fully phased in: $4,420

Percentage of college graduates under age 35 that are paying off college debt who say their loans will take them more than ten years to pay off: 39

Percentage of them who say they have delayed a medical or dental procedure because of their debts: 27

Proportion who say their college loan debts have caused them to delay getting married: 1 in 6

Price that private investors paid in 2007 to purchase Sallie Mae, the student loan company which began as an enterprise run by the government for the benefit of college students: $25 billion

Overview/Summary

Middle Class Position Analysis

The Middle Class Supports. In today’s world, a college education is necessary to attain a middle-class standard of living. A college-educated workforce is also critical to the nation’s economic strength. Yet the cost of college, and the amount of debt students must take on to afford it, is rising rapidly. The value of federal student aid programs, such as Pell Grants, has failed to keep pace with rising college costs, while many states have reduced their support for public universities. As a result, nearly two thirds of students at four-year colleges must now borrow to finance their college education, and the typical student borrower now graduates with nearly $20,000 in debt – and some with much more. The prospect of taking on tens of thousands of dollars in debt deters some students, especially those from lower-income families, from pursuing college entirely. Meanwhile, the need to pay off costly student loans makes it impractical for many graduates to pursue public service careers in essential fields such as teaching or social work. For many young people, the burden of student loan debt makes it difficult to make ends meet on a daily basis, much less support a family or begin to save for retirement. Through its wide array of measures to make a college education more affordable – including the groundbreaking effort to encourage colleges not to raise tuition, while prodding states to strengthen their investment in higher education – this bill will help millions of American young people attend college and begin their working lives without such an overwhelming burden of debt.

Quotes from Experts

Beyond this Bill

Additional Resources

The Project on Student Debt, a project of the Institute for College Access and Success

Student Debt Alert, a project of the Student Public Interest Research Groups

“Higher and Higher Education: Trends in College Access, Affordability, and Debt,” from Demos

Saving for college

Higher Education Opportunity Act of 2008

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

Ensuring Continued Access to Student Loans Act of 2008

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources

College Cost Reduction Act of 2007

Legislation

The middle class

Video Summary

Injustice Facts

Overview/Summary

Middle Class Position Analysis

Related Blog: Header

Quotes from Experts

Related Blog: Text

Beyond this Bill

Related Blog: Link

Additional Resources