In the midst of the rising costs of a college education, someprograms have cut back on financial aid, scholarships, and studentloans for students. The result: many students are forced totake time off from college. Some are fortunate to return ayear or two later. Others never return.
One of the reasons for the student loan shortage is becauseabout 10 years ago Congress cut back on millions of dollars insubsidies that would have directly benefited students about 10years ago.
According to the New York Times, those offering student loansare collecting large amounts of the old subsidies as a loophole inthe law, billing the government at least four times theamount. Some student loan companies are securing nearly 10percent interest rates while students pay between three and fourpercent.
This allows some student loan companies to profit off theoversight of the government.
Meanwhile, some schools have been forced to cut financial aidpackages though the cost of tuition continues to rise steadily eachyear.
On the other end of the spectrum, some colleges are being forcedto cut out scholarship programs that promote diversity. Forexample, the University of Richmond will most likely phase outtheir African-American scholarship program after deciding thescholarship was discriminatory.
Adrienne Adger, a graduating senior, said that while she willnot be impacted by the impending cuts, she is disappointed thatother Black students will not be able to benefit from theprogram.
“It’s disheartening because it shows the school is not committedto diversity,” she said, explaining that those who are looking toapply for the scholarship will likely not qualify under theproposed new rules.
Meanwhile, students and parents will again be paying more for acollege education. The cost of college tuition is expected torise again this year though the increase will be less than theprevious two years.
This year, the average increase is 9 percent, which is about$491, compared with last year’s 14 percent average increase,according to the USA Today.
The reason for the increase is due to state budget cuts, growingstudent enrollment, the rising cost of health insurance andbuilding renovations and construction.
Overall, American colleges are given an “F” when it comes toaffordability for students and parents, according to a biennialstudy by the National Center for Public Policy and HigherEducation. The group received a “D” two years ago.
The report card examines states on the performance of privateand public schools and community colleges in five categories. For affordability, the report card challenges some recent studiesthat say financial aid increases have kept up with current tuitionincreases–thus evening out actual college costs, according to theAssociated Press.
The USA Today reports that some schools are providing additionalfinancial aid but not necessarily to those who need it, said PatCallan, president of the National Center for Public Policy andHigher Education.