Shopping around for college becomes easier with new tool
It was the only mention of high college costs during Mitt Romney’s visit to the Mahoning Valley in March.
“Shop around. Find the one with the lowest price,” Romney said about looking for the right college.
His comment caught the attention of local, regional and even national media outlets, just as the cumulative student loan debt approaches the $1 trillion mark.
For the first time, student loan debt has surpassed credit card debt.
FinAid.org’s Student Loan Debt Clock estimates the total to be around $995 billion.
To help students avoid, or at least alleviate, college expenses, the Consumer Financial Protection Bureau debuted its Financial Aid Comparison Shopper last week.
“The [FACS] helps families make smarter choices by allowing parents and students to take the information they already have, along with data compiled by the federal government, and leverage it,” Rich Cordray, director of CFPB, said in an issued statement.
The tool allows users to compare tuition and other expenses at up to three universities. The program factors in the average amount of grants and scholarships, then calculates the total cost per year for attending that school. It also calculates monthly payments for the 10 years following graduation by considering varying interest rates for subsidized and unsubsidized loans.
For example, Youngstown State University’s total cost for a freshman is $19,923. Subtract $7,779 in average grants and scholarships, and the student is left borrowing or paying $12,144.
YSU grads who finish in four years would owe $719 per month for 10 years to pay off their bill. This is considering that students deferred all of their payments until after graduation.
Kent State University graduates would tentatively owe $977 a month for 10 years. Graduates of the University of Akron would see bills for $810 a month in the same time frame.
“One of the goals of the [CFPB] is to ensure that consumers get clear, easy-to-understand information so they can make an informed decision about what is best for them,” Rohit Chopra, CFPB’s student loan ombudsman, said in an email.
The calculation doesn’t factor in future income, something that YSU officials say should be a part of any decision to take out a loan.
Elaine Ruse, director of the YSU Office of Financial Aid and Scholarships, said some students don’t consider their starting salary after graduation when taking out loans to pay for college.
“It’s important to look at your major and try to find out what’s the starting salary for someone in your field,” Ruse said.
Unprepared debtors run the risk of damaging their credit scores, which can lead to bigger problems.
“This can make it harder to get a job, rent an apartment or borrow money to start a business,” Chopra said in an email.
YSU oversees 482 scholarships and provides students with assistance to receive grant funding.
Senior Rebecca Soldan, 31, and her husband have paid for college mostly through grants and loans.
Soldan, a nontraditional student, said she is thankful that scholarships will cover her remaining time at YSU.
“I don’t have to pay any more,” Soldan said.
Still, Soldan estimates that she and her husband will owe a combined $30,000 after graduation.
“It’s critical to consider free money first,” Ruse said. “Don’t take on loans until you’ve explored scholarships and grants.”
Junior Alexa Koutsourais and sophomore Jeana McEvey both said they feel fortunate that their schooling is entirely paid for through scholarships and their parents’ contributions.
A stipulation exists for McEvey, however.
“They agreed to cover the first four years,” McEvey said. This serves as a motivating factor for her to graduate on time.Chopra said the comparison tool is still in its beta stage, and public feedback will be used to make improvements as it develops.