Student Loan Blog : Community Colleges

Dorms Add to Community Colleges’ Appeal

Student Loan Girl — Tue, 14 Apr 2009 23:19:00 GMT

In an attempt to offer a low-cost alternative to college students who typically attend more expensive private and public institutions, community colleges have started building on-campus dorms, a move that may soon alter the commuter culture at such schools, reports the Los Angeles Times (“Community Colleges Add Dorms to Boost Appeal,” April 7, 2009).

With tuition rising at most colleges and universities across the country, experts say that larger numbers of college-age students are opting to enroll in two-year schools offering the same type of college dormitory life traditionally found only at a four-year university. And many community colleges are actively promoting their on-campus housing amenities in their recruitment of international students and athletes, two demographics who often prefer on-campus housing.

“We do think it’s a trend for more community colleges to provide residential housing for students,” said Norma Kent, spokeswoman for the American Association of Community Colleges.

States Responding to Need for Community College Dorms

Dorms at community colleges are being built in Washington state, Florida, Texas, Minnesota, and California, where both the University of California and the California State University systems have said they will severely limit freshmen enrollment this fall.

Educators believe that California — with nearly 2.8 million community college students or roughly 25 percent of the nation’s total community college population — may be particularly ripe for adding new dorms.

With both of the state’s university systems accepting fewer freshmen this year, many of the 4,000 first-year students who’ve been denied admission to those four-year schools may be more likely to consider a two-year school that offers on-campus housing versus one that doesn’t.

And what may come as a surprise, the Los Angeles Times reports, is that 11 community colleges in the state already have dorms, although many of those decades-old dorms resemble 1950s-era military barracks. Other dorms, like those at Sierra College near Sacramento, have been updated and include meal plans honored at local restaurants, one of many features intended to lure students to its campus.

Cerro Coso Community College, a 300-student school located in Mammoth Lakes, says that its South Gateway Student Apartments — an $8.5 million residence hall built last August that can house 59 students — is the first new community college housing to go up in California in 20 years. Funded by a grant from the Mammoth Lakes Foundation, the new dorms aren’t cheap: $900 a month for a single room or $750 a month for a shared room, plus meals.

Feedback from students regarding community college dorms is largely positive. Some students say they’re succeeding at school for the first time and that they enjoy the intimate surroundings and small class sizes that community colleges can offer.

Sharon Carroll, a student at Cerro Coso Community College, said that if she had to fight the traffic and large class sizes of an urban community college, “I would have been sick of school already. I figured out a lot from being here. It made me want to go to a four- year college.”

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Two-Year Schools Waiving Tuition For Laid-Off Workers

Student Loan Girl — Tue, 09 Dec 2008 23:17:00 GMT

Typically, when the economy is down, enrollment is up at the nation’s community colleges. However, in the current economy, in which the unemployment rate is at a record high, Americans who find themselves recently unemployed can’t afford to further their education even at inexpensive local institutions.

In an effort to help, some community colleges in Pennsylvania are waiving tuition for local residents who were recently laid-off, reports Inside Higher Ed (“The Jobless Discount,” Dec. 5, 2008).

Reading Area Community College in Reading, Pa., extends a waiver to local residents who have been laid off within a year of applying to the school. The waiver, which represents a potential savings of $962, is valid for one semester to qualified students for up to 13 credits.

The tuition waiver benefits both students and the institution, since RACC students will get financial assistance furthering their education in the hopes that they’ll continue their education and become paying students once they’re employed, said David Zimmerman, a career services officer at RACC.

“It’s good will, and it’s good PR,” Zimmerman said. “It helps the community and helps people get back into the work force.”

This year, participation in the tuition waiver program is higher than in previous years, Zimmerman said. He speculates the closing of two local business plants owned by the Hershey Company and Tyco Electronics Corporation may be contributing to the spike in interest.

Tuition Waivers May Cost Pa. School $100,000 in Lost Revenue

Northampton Community College, located in Bethlehem, Pa. announced that starting next semester it would begin waiving tuition for those who were recently laid off due to plant or local business closings.

Under the waiver, qualified students will be able to take a maximum of 12 credits at a reduced cost beginning in January 2009. Students would be required to pay $28 in fees per credit, for a total savings of $900. The number of students allowed to enroll under the waiver program would be limited to the number of empty seats available in each class section.

Northampton President Arthur Scott said offering a tuition waiver may cost his school more than $100,000, because the school isn’t adding sections or other resources to accommodate for students who take advantage of the waiver, meaning the waiver isn’t considered an institutional expense, but rather lost revenue.

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Pastors Indicted in $4 Million Student Loan Scheme

Student Loan Girl — Wed, 26 Nov 2008 23:19:00 GMT

The husband-and-wife pastors of a Houston church have been indicted in a student loan scheme in which the pastors and another church leader allegedly defrauded the government of millions of dollars in student loans, according to a news release from the U.S. Attorney General Office (“Leaders of ‘Fishers of Men’ Church Charged With Student Loan and FEMA Fraud,” Nov. 20, 2008).

Eric and Sheila Washington, then pastors of the Fishers of Men Worship Center, as well as church treasurer Tony Overstreet, are accused of filing 140 student loan applications totaling more than $4 million on behalf of church members over a two-year period. The church leaders say they intended to use the money to fund a new church building.

The Washingtons and Overstreet allegedly coaxed college-age church members into providing the church leaders with their personal identifying information. The three church leaders then used that information to apply for student loans in the church members’ names and provided the student loan lenders with the Washington’s address so the loan funds could be mailed directly to their home.

Students were typically allowed to keep $2,000 of the loans — which were generally in the amount of $25,000 or $30,000 — and were promised that Fishers of Men would repay the loans within six months, according to the indictment.

Non-Student Church Members Roped Into Scheme

The indictment further alleges that the Washingtons and Overstreet recruited Fishers of Men church members to falsify their paystub information in order to qualify as co-signers on the student loans.

Once the trio had acquired information from every eligible churchgoing student, the Washingtons and Overstreet allegedly found a new way to get student loan funds — by enrolling other church members in community colleges and then withdrawing the church members from classes as soon as the loans were funded.

Bank One funded over 90 student loan applications worth $2.75 million before the fraud was discovered. The Washingtons and Overstreet then used the same scheme with Wells Fargo, through which they submitted more than 50 applications for college loans totaling $1.5 million.

Eric Washington and Fishers of Men Secretary Felicha Williams are also charged with conspiring to defraud FEMA (Federal Emergency Management Agency) of funds related to a program that reimbursed shelters for housing Hurricane Katrina evacuees by overstating the number of evacuees the church temporarily housed.

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State Higher Education Commission Urges Indiana Schools to Graduate 10,000 More Students a Year

Student Loan Girl — Wed, 10 Sep 2008 20:58:00 GMT

A new plan unveiled Monday by the Indiana Commission for Higher Education calls for the state-supported colleges and universities in Indiana to graduate 10,000 more students with bachelor’s degrees each year — an increase of 33 percent — and to graduate these students in just four years, according to the Associated Press (“Indiana Seeks 10,000 More College Graduates a Year,” Sept. 9, 2008).

Under the proposed plan, Indiana would rank among the top 10 states in the nation for college degree completion by 2012. Indiana is currently 10th in the nation for the number of its high school graduates who enroll in college — 62 percent — but 57 percent of the state’s college students take six years to graduate and only 36 percent graduate within four years.

“We want more degrees and we want them on time,” said commission member Gerald Bepko, former chancellor at Indiana University-Purdue University Indianapolis.

To motivate state schools to improve their four-year graduation rates — a move that the commission contends will reduce students’ college costs and student loan debt — the commission proposes that state funding be tied to a college’s degree completion rate rather than its enrollment growth.

“They used to say, ‘Give us more money and we’ll do a better job,’ ” said Stan Jones, state commissioner of higher education. “We’re saying, ‘Do a better job and we’ll give you more money.’ ”

The commission also hopes to build up the state’s community college system to make it easier, financially, for students to complete their bachelor’s degree in four years. The commission recommends that community colleges work to double their enrollment over the next 10 years and make the first two years of community college tuition free for students whose families earn less than $50,000 a year.

The plan would, in addition, make more families eligible for state financial aid by raising income limits.

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Community Colleges Want to Control How Much Certain Students Can Borrow in Student Loans

Student Loan Girl — Fri, 20 Jun 2008 23:54:00 GMT

Concerned that some students at two-year schools may borrow more in federal student loans than they can afford to repay, community college officials want the federal government to give community colleges control over how much their students can borrow in federal aid.

Community colleges want the authority to deny some of their own students the right to take out federally subsidized loans, because the schools believe that some students may not earn enough after graduation to repay their student loan debt, according to an article in The Chronicle of Higher Education (“Community Colleges Want Their Authority, Not Banks,’ Over Student Borrowing,” June 18, 2008).

The change is needed because colleges currently have no way of preventing a student from taking out a college loan that doesn’t make economic sense given the student’s long-term job prospects, says David Baime, vice president of government relations for the American Association of Community Colleges.

The association, which represents more than 1,200 institutions nationwide, is pushing for legislation that would give community colleges the right to control how much their students can borrow, rather than being at the mercy of private lenders who can stop lending to certain schools at any time. The AACC is lobbying for this authority after a recent move by some of the nation’s biggest banks to stop offering student loans to certain community colleges and other two-year institutions.

The banks’ decision to cease lending to these schools also prompted Democratic Senators Patty Murray and Christopher Dodd to introduce legislation that would prohibit lenders from ‘cherry-picking’ which schools they do business with.

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Proposed Legislation Would Prevent Student Loan Lenders from ‘Cherry-Picking’ Schools They Lend To

Student Loan Girl — Fri, 20 Jun 2008 01:14:00 GMT

To ensure all students have access to student loans regardless of what type of school they attend, two Democratic senators introduced legislation Tuesday that would prohibit banks and other lenders from “picking and choosing” which institutions of higher education they do business with, according to a New York Times article (“Bill Promotes Universal College Loans,” June 18, 2008).

Under the proposal, lenders that participate in the Federal Family Education Loan Program would have to extend credit to any eligible student, regardless of a student’s income or the type of institution they attend, as long as the student’s college is a member of the FFEL program, writes Times reporter Jonathan Glater.

Senators Patty Murray, D-Wash., and Christopher Dodd, D-Conn., introduced the legislation in response to the decision of Citibank, JPMorgan Chase, PNC, and SunTrust to stop offering student loans to community colleges and other two-year institutions.

“Lenders offering loans backed by taxpayer dollars shouldn’t be able to discriminate against certain schools or students,” Murray said in a statement. “Denying loans based on school, program length, or income level locks the door for far too many.”

Bill Faces an Uncertain Future

Banks who have ceased lending to certain two-year institutions contend that they lose money on the loans. Schools that have been cut off by the banks tend to have higher default rates and fewer borrowers with small loan amounts — financial factors that, lenders say, make business at these schools less profitable.

But financial aid administrators counter that lenders should not be allowed to “cherry-pick,” because selective lending could make it harder for low-income students to pay for college.

The proposal, which is under review by the U.S. Department of Education, has already been met with controversy. Some financial aid officials support the measure as way of ensuring access to student loans, while others believe it might have the unintended consequence of pushing lenders out of the federal student-loan business altogether at time when over 100 lenders have already left the FFEL program.

While the bill’s prospects are unclear, Sen. Edward Kennedy, D-Mass., chairman of the Senate Committee on Health, Education, Labor, and Pensions, is expected to co-sponsor the bill.

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Back from Surgery, Kennedy Calls On Community Colleges to Switch to Direct Lending

Student Loan Girl — Tue, 17 Jun 2008 18:11:00 GMT

Sen. Edward Kennedy, D-Mass., sent a letter Monday to the American Association of Community Colleges, urging its members to enroll in the government’s Direct Loan Program in order to ensure community college students have access to student loans for the 2008–09 academic year.

Kennedy, the chairman of the Senate Committee on Health, Education, Labor, and Pensions who is recovering from surgery to remove part of a malignant brain tumor, encouraged AACC member colleges to sign up for the direct lending program, which allows students and parents to take out student loans directly from the U.S. Department of Education.

Almost 100 lenders in the rival Federal Family Education Loan Program, in which student loans are provided by private lenders, have reduced or stopped offering borrower incentives, or have dropped out of the FFEL program altogether.

Government subsidy cuts and the fallout from the subprime mortgage crisis have hurt lenders and have prompted some to announce they will no longer offer student loans to certain community colleges and other two-year institutions whose borrowers tend to carry smaller, less-profitable loans.

"Since lenders continue to say they may have to limit new loans to certain colleges, it’s possible that the neediest students, particularly those at community colleges, will need an alternative to the bank-based FFEL program," Kennedy wrote.

David Baime, vice president of government affairs for the AACC, countered that the problem is not that student loans are inaccessible, but that community college students tend to borrow more money than they can afford to repay ("Kennedy Urges Community Colleges to Enroll in Direct-Loan Program," June 17, 2008).

That’s why the association is pushing a measure through Congress, Baime says, that would give colleges the authority to reduce maximum college loan amounts that students could borrow under the federal student loan programs.

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With Government’s Help, Lenders Returning to Federal Student Loan Market

Student Loan Girl — Thu, 05 Jun 2008 21:08:00 GMT

A number of lenders who abandoned the federal student loan market in recent months may be returning, in light of a new law designed to keep struggling lenders afloat, according to a Dow Jones Newswires article.

Many of the 102 companies that scaled back or withdrew from the Federal Family Education Loan Program, in which federal student loans are funded by private lenders, are expected to at least consider returning to the program for the 2008–09 academic year, writes Dow Jones reporter Melissa Korn (“Student Lenders Tiptoe Back to Market With Government Bailout,” June 4, 2008).

Brett Lief, president of the National Council of Higher Education Loan Programs, said every one of the lenders in his organization "changed their policies" during the credit crunch earlier this year — reducing or suspending their participation in the FFEL program. The 60 FFELP lenders that are members of the NCHELP reported that the changes were necessary because federal student loans were no longer profitable.

But after Congress passed the Ensuring Continued Access to Student Loans Act (HR 5715), which gives the U.S. Department of Education the authority to buy student loans from lenders who have been unable to sell them, those lenders are “all reviewing their policies again,” Lief said.

Before the passage of the act, Sallie Mae, one of the nation’s largest originators of federal student loans, was considering whether to remain in the FFEL program, and Nelnet, NorthStar Education Finance, Inc., and the Kentucky Higher Education Assistance Authority had left the FFEL program.

Under the new legislation, all four of these lenders have reaffirmed they will continue to issue new federal student loans. However, some lenders still question whether the government changes will ultimately be profitable despite the Education Department’s infusion of liquidity, while other lending banks, like Citibank, JPMorgan Chase, PNC, and SunTrust, remain unmoved.

These banks no longer offer student loans to certain colleges — schools that they have determined tend toward higher default rates, fewer borrowers, and smaller loan amounts that make business less profitable.

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Calling all Men

Student Loan Girl — Fri, 25 May 2007 19:49:00 GMT

Where have all the men gone? It appears as if male enrollment at community colleges is on the decline and officials at these institutions are trying to address the problem. According to a May 23, 2007 article written by Scott Jaschik titled, “Looking for Male Students,” that appeared in Inside Higher Ed, “When community college leaders gather these days, one topic that seems to come up all the time is what to do about declining male enrollments. Nationally, men make up 43 percent of college students, and there are plenty of community colleges where that proportion is smaller.”

Jaschik went on to report:

“On Tuesday, the efforts of one such institution — St. Petersburg College — were described to a very engaged audience at the annual meeting of the National Institute for Staff and Organizational Development, in Austin. With male enrollment down to 39.7 percent at the ethnically diverse (half white, half other groups) Florida college, Rod Davis has been moved from a position as academic advisor to coordinator of the Male Outreach Initiative, and he described the process of putting together such a program.

“In part, he said that the college didn’t want to re-invent the wheel, so it’s been looking at what other institutions — in and out of academe — are doing. For example, in talking to those who enlist in the military, Davis said it was clear that the way the military is reaching students is getting involved in middle schools and high schools early, with military recruiters volunteering with sports teams and building relationships early — without an explicit recruiting agenda. Davis said that if the military can succeed at this — even at a time of war — surely colleges can.”

Work before School

It appears as if one of the challenges facing potential male students is that they are unaware of programs that can help them balance their full-time jobs with going to school. Jaschik reported that according to focus groups being run by St. Petersburg College in Flordia, “Many of the students’ employers have tuition reimbursement programs, but the college found that male students in particular didn’t know about them, or how to get access to the money to which they are entitled. So the college has started bringing in human resources officials from major employers to talk about benefits such as tuition reimbursement.”

He went on to quote Davis, “Men know where they want to go, but have no ideas about how to get there.”

Men are from Mars

We’ve all heard the rumors that men don’t communicate their “needs” as often or as well as women do. Apparently, studies are touting men’s lack of communication skills as one of the reasons they are not getting the programs they need to both work and attend school. Jaschik reported:

“A related problem is that male students are less likely to be communicative about what their issues are — unless asked directly. Male students will end up having several meetings with an academic or financial aid counselor before revealing what is really on their mind, he said. The male students appear to be more willing to be open with male counselors, so the college is trying to make sure staffing is balanced on gender.

“St. Petersburg College is also doing a lot of research on retention patterns and trying to share the results with academic counselors. For instance, Davis said that for male students on average, distance education isn’t wise in their first year, as drop-out rates are high.”

The student loan advisors at NextStudent are helpful and knowledgeable about student loans. They are a trusted source in getting you the appropriate information about your student loan consolidation, student loan options and helping students get the college financing they need. Go to www.nextstudent.com for more information.

Be sure to tune in next Thursday for my next blog on student loan advice.

Student Loan Girl

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What are the Salaries of Presidents at Two-Year Colleges?

Student Loan Girl — Wed, 18 Apr 2007 17:26:00 GMT

So, looking for a high-paying job that you might want to aspire to one day? Love college and the whole academic environment? Well, what about becoming the president of a community college? According to an April 16, 2007 article written by Elyse Ashburn titled, “Presidential Pay Tops $160,000 at 2-Year Colleges, Survey Finds,” that appeared in The Chronicle of Higher Education, “Community-college presidents make an average of $161,380, up 6 percent from last year, according to preliminary survey results released on Sunday by the American Association of Community Colleges.”

Presidents at Two-Year Colleges vs. Professors at Two-Year Colleges

Professors at two-year colleges are doing pretty well for themselves nowadays, too, however, not quite as well as community college presidents. Ashburn reported, “Presidents’ base salaries averaged $153,684, plus other cash benefits, according to a national survey of 548 two-year colleges conducted in November. By comparison, full professors at community colleges make $68,289 on average, according to data released last week by the American Association of University Professors (The Chronicle, April 12, 2007).”

Other Fun Facts on Presidents at Two-Year Colleges

The findings on presidential compensation as well as other facts about community college presidents were released at the American Association of Community Colleges’ recent annual conference. Ashburn reported that other findings of the survey included:

“Colleges leaders in the far Western states and the mid-Atlantic were the highest paid, while those in the Rocky Mountain region were the lowest paid.
Male college presidents made $164,759 on average, while female leaders made $160,137.
About 2 percent of presidents received signing bonuses.
About 20 percent of presidents received compensation for outside work, earning an average of $8,784 a year.
Half of presidential contracts placed no restrictions on outside work.”

If you want to know more, you’ll have to wait until this summer when the American Association of Community Colleges releases a full report on its findings.

NextStudent can help you fund your college education, be it two years or four. If you want to know more about strategies that help make college affordable, talk to the education financial advisors at NextStudent. They have all the information and advice you need on student loans. Check out www.nextstudent.com.

Be sure to tune in next Tuesday for my next blog about this week in student loans.

Student Loan Girl

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Grant Process Closed on Strengthening Institutions Program

Student Loan Girl — Wed, 31 Jan 2007 21:55:00 GMT

Grants are an important source of funding for any institution and organization in need of money. Not only do grants help students defray the cost of attendance, they also help colleges keep their tuition costs in check because awarded funds can help strengthen developing academic programs.

According to a Jan. 30, 2007 article written by Elyse Ashburn titled “Education Dept. Won’t Open Grant Process This Year for Program Serving High-Need Institutions” that appeared in The Chronicle of Higher Education, “The U.S. Department of Education announced on Monday that it would not take new applications this year for the Strengthening Institutions Program, which provides grants to institutions that predominantly serve students from low-income families.”

With all the talk on Capitol Hill about slashing student loan interest rates and raising Pell Grants in a bid to help more low-income students achieve the dream of a higher education, this move by the Department of Education seems somewhat counterintuitive.

Grants Still Being Awarded

It is to be noted, however, the Department of Education will still award grants this year. It is just the “process” of accepting new applications that is being nixed. Ashburn reported, “The department instead will award grants to 2006 applicants that were of high quality but did not make the cut last year.”

Basically the thinking is that by not opening the review “process,” all monies available will be awarded as grants, with none going to pay for the manpower to review the applications. However, Ashburn goes on to report, “advocates for community colleges, which are the primary beneficiaries of the program, questioned the fairness of that approach and said that a new application process should be held.”

Ashburn quoted David S. Baime, vice president for government relations at the American Association of Community Colleges, as saying, “Community colleges across the country will be disappointed to learn that the department is not holding a new competition for this program.” Baime explained, “Simply dusting off last year’s applications and going down the list seems quite unsatisfactory from a good-government point of view.”

Where the Funds Go

So, in the long-run there, institutions that did not receive grants from the Strengthening Institutions Program last year, will be receiving funds this year, which although might not seem fair to all, is at least helping the community the grants were intended to help. Ashburn wrote, “Grants from the program can be used for a variety of projects, including improving faculty development, establishing endowments, and strengthening academic programs. The program received about $80-million in the 2006 fiscal year. Congress has not finalized its 2007 allocation.”

To find out more about free money, check out NextStudent’s Scholarship Search Engine: http://www.nextstudent.com/scholarship_search/scholarship_search.asp. And remember, the key to finding free money to help fund your college education is to search early and search often.

It is important to keep up to date on the effects of legislation and news on student loans and education. What goes on in government and in your state can have a great impact on your student loans and your college education.

For all the information you need about student loans, go to www.nextstudent.com.

Be sure to tune in next Wednesday for my next blog on student loan legislation in the news.

Student Loan Girl

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