As the start of the fall semester approaches, students across the country are finding themselves in a precarious position when it comes to financial aid.  As we’ve previously mentioned, several states have been forced to make deep budget cuts this year, canceling or reducing funding for scholarships and grants, in some cases after award notices have already been sent to students.  This has left students scrambling for last-minute student loans, and in some cases facing the difficult decision of whether to take a semester off while trying to procure alternate funding.

The Wall Street Journal and U.S. News both feature articles this week that offer up alternatives for students who have come up short on funding for the fall.  While scholarship opportunities are still available for the coming academic year and should be pursued, students who need immediate sources of funding may want to check out private loans, peer-to-peer lending, and emergency loans and other aid offered by some universities and state agencies.  Reducing to part-time enrollment or transferring to a cheaper school are also last-resort options that may be better choices than taking an entire semester off or putting tuition on a credit card.

An appeal to your college’s financial aid office can also produce more financial aid, especially if your financial situation has changed since you completed the FAFSA, or if your parents were turned down for a federal PLUS loan.  Additional loans, and even some grant aid, may be available if you ask.

In addition to trying to find new sources of funding, some college students are also petitioning their state legislators to get grant and scholarship funding restored.  Lawmakers in Utah have listened, promising to reinstate full funding to the state’s New Century Scholarship program, whose awards they had previously planned to cut nearly in half.  Students in Michigan also may yet get a reprieve from budget cuts, as the governor of Michigan and numerous state legislators are vowing to do what they can to keep the state’s popular Promise Scholarship program intact.

Even if states manage to find funding for grants and scholarships this year, the next fiscal year could also prove challenging.  Students in cash-strapped states who are planning to rely on state scholarships to pay for college may want to start looking into alternate funding now.  One of the best ways to do this is to start with a free college scholarship search.

Posted: under College Costs, College Grants, College News, College and the Economy, Financial Aid, Tips.
Tags: College and the Economy, College Costs, College Grants, college news, Financial Aid, Scholarship Search, state grants, state news, state scholarship, Student Loans, Tips

Comments (0) Aug 19 2009

Rising unemployment rates and other symptoms of the ongoing recession continue to drive more people to attend college and look for ways to pay their bills, causing an uptick in state and federal financial aid applications. However, states are also hurting for money to meet financial aid requests and other budget demands. According to the Associated Press, 12 states have made significant cuts to state grant programs so far this year, with additional cuts likely. At least anecdotally, these cuts are already leading to more reliance on student loans, especially among groups that, according to a brief published this week by the College Board, may already be finding themselves overburdened with debt.

This week, the College Board released some new numbers on student debt loads and borrowing habits, culled from the National Postsecondary Student Aid Study, data released every four years by the Department of Education.  Students at for-profit colleges are the most likely to borrow (96-98 percent graduate with some amount of loan debt), have the largest average debt loads at graduation, and are also some of the poorest college students (students at for-profit schools received 19 percent of the federal Pell Grants disbursed in 2007-2008 despite making up only 7 percent of the college-going population).  With additional sources of need-based aid drying up, these students may find themselves even more burdened with debt.

Students at other types of schools have also had to do more borrowing in recent years, according to the study.  A full 59 percent of college students graduate with some amount of student loan debt, including 66 percent of bachelor’s degree recipients.  While most students took on manageable amounts of debt, 10 percent of students at four-year public schools, 22 percent of students at four-year private colleges, and 25 percent at four-year for-profit colleges borrowed more than $40,000 to attend college.

The average loan debt of undergraduate students in 2007-2008 was $15,123 (this is all students, not graduates), up 11 percent from the last time the survey was conducted.  While increases in loan burdens were most modest at four-year state and non-profit colleges, reductions in state grant programs that are often earmarked for students at state colleges or nonprofit private colleges could send these numbers climbing.

You may want to consider statistics on student debt as a factor in your college search, but keep in mind that there are alternatives to borrowing.  Scholarship opportunities exist for students at every type of college pursuing many different types of degree programs.

Posted: under College Costs, College Grants, College News, College and the Economy, Financial Aid, Student Loans.
Tags: College and the Economy, College Costs, College Grants, college news, Financial Aid, grants, private loans, state colleges, state grants, state news, student debt, Student Loans

Comments (0) Aug 12 2009

While it may be grabbing most of the headlines, the federal “Cash for Clunkers” program is not the only government grant program to run out of money well ahead of schedule this year.  The state funding allocated to Illinois Monetary Awards Program (MAP) grants, college financial aid awards for needy students, was slashed during state budget cuts this year. As a result awards have been cut in half for all students and have been denied outright to over 130,000 students who applied after May 15, a significantly earlier cutoff date than previous years.

Typically, Illinois MAP grants award up to $5,000 per year to the neediest college students in the state, provided they submit their financial aid applications by mid-August.  This year, however, the deadline was moved up to mid-May due to budget cuts.  Even students who applied on time will still receive reduced funding, as the current budget for the program can only cover grants for one semester of study.  Students at community colleges, who typically apply for financial aid later in the year and often have access to fewer financial resources, are likely to be the hardest hit.

Illinois isn’t the only state forced to make cuts to its college grant programs.  California and Ohio are among others that have recently gained attention for cutting aid to college students.  If you live in a state that’s been forced to reduce student financial aid, you still have options to pay for college.  Before looking into student loans or considering a semester off, conduct a free college scholarship search. Scholarships, including state and local scholarships, are still out there despite the recession.

Posted: under College Grants, College News, College and the Economy, Financial Aid.
Tags: College and the Economy, College Grants, college news, Financial Aid, grants, state grants, state news

Comments (0) Jul 31 2009

Student financial aid programs in several states may soon fall victim to sweeping budget cuts necessitated by the recession.  Ohio, Florida, Michigan, and California are all considering proposals to reduce or eliminate some state student aid programs, including popular grants and scholarships.

Ohio and Florida are both making slight changes to rules in existing aid programs, resulting in less aid for some students, but mostly leaving financial aid intact.  Florida is capping their Bright Futures scholarship so it no longer covers all of students’ tuition or tuition increases, while Ohio is changing rules in their Ohio College Opportunity Grant to focus aid towards tuition and fees at public schools.

California and Michigan, however, are making far more sweeping cuts.  California has proposed eliminating CalGrants, a popular state grant program, for incoming college freshmen and cutting CalGrants for current college students.  Michigan may eliminate the Michigan Promise scholarship and make sweeping cuts to several other state financial aid programs, including work-study.  Students in both these states could find themselves suddenly thousands of dollars short on college financial aid.

While federal stimulus money has mitigated some of the damage in many states, in Michigan it has also played a large role in the proposed cuts to financial aid, according to The Detroit News.  Since a provision in the stimulus legislation prevents states from drastically reducing funding to higher education institutions, Michigan may be forced to turn to cutting state grant and scholarship programs to make up some of their budget deficit.

While some state aid and loan forgiveness programs are being reduced or eliminated, financial aid is still available.  Many college are actually increasing their budgets for university scholarships, and private foundations are still offering scholarship aid, as well.  Federal student financial aid has also seen some increases in the last two years.  Money is still out there if you know where to look, and a great place to start is doing a free college scholarship search.

Posted: under College Grants, College News, College and the Economy, Fellowships, Scholarships.
Tags: College and the Economy, College Grants, college news, Financial Aid, grants, state grants, state news, state scholarship

Comments (0) Jun 16 2009