Entries for September 2008

A group of leading financial aid experts say the government ought to radically simplify and improve the federal financial aid system—and they say it wouldn't take much money to do so.

The "Rethinking Student Aid" study group, funded by several foundations and the College Board, said that simply by allowing parents and students to submit their tax information, instead of filling out the 145-question federal financial aid application, thousands of students might get more aid and be more likely to finish college. In addition, the group, made up of college presidents, economists, and other financial aid experts, said that Congress should consolidate the many small, sometimes overlapping grants and loan programs so that there is just one of each. That would save the government and colleges millions in administrative hassles, and make it easier for students to understand. By radically restructuring the biggest student loan program, Congress could help to fund new college savings accounts for low-income families and give all educational borrowers an opportunity to pay their loans back as a percentage of their income, instead of today's fixed payment, according to the group.

Fatima recently posted this question on our financial aid forum:

"Hey there! I am sooo desperate and I need your help! I just found out that I got admission for CSU East Bay! Unfortunately, I wanted to get a student loan over here in Germany, but they don't give it to students who want to study out of Germany when you are not German. I got so upset when I heard that. Anyway, then I looked for some student loans in the States, but all of them want a cosigner (somebody who is American or has American residence). I worked hard for that admission and I really want this, but I don't know how to get the money together. Fatima"

I wish I could report good news to Fatima and the millions of other non-U.S. citizens who need a loan to pay for an American college. But the sad truth is that there just aren't many loans out there for them. The cheapest student loans in the United States are backed by the federal government, which will lend to only a few kinds of noncitizens, such as refugees. And the credit crunch seems to have dried up the more expensive private loans made by banks.