The various letters and Op-Ed pieces regarding student loans have all missed the point in my view as a college counselor with over 40 years in the admissions/financial aid business. The system “screams” reform.
The whole college finance industry has been making big money off the backs of students and families ever since the 1958 National Defense Education Act. Many colleges in search for the “buck” grasp at any straw to “find” the tuition dollar. Students and their unsuspecting parents have been coerced into loans that the colleges know will financially strap them for a long time and maybe forever as we have seen in anecdotal cases. (Note the George Danby cartoon of May 15).
First of all, those who blame the borrowers are being unfair. Many high school counselors are just as uninformed and naive as their students, and the abuse by colleges got so bad that the U.S. Department of Education had to require colleges to provide loan counseling to students who still don’t have all the facts — does this sound like the predatory mortgage market that crashed in recent years?
Colleges use bait and switch in offering the typical financial aid package that does not usually cover all the costs for the year and at the last minute, usually after the student has committed to that school, a shortfall appears requiring yet another loan.
To make matters worse, many colleges do not guarantee the free aid, or college grants, for all four years so many students will find themselves way short in subsequent years and are forced to borrow more money to stay at that college. Maine, with one of the lowest college completion rates in the country, has too many students who had aspirations for a future but find themselves out of school with no degree and high student loan debt.
Six months after leaving college, the first payments are due. With no degree to show for it and to help pay, many loans end up in default thereby making them ineligible for future financial aid if they decide to return to school — they are forever failures. The worst offenders are the for-profit colleges and the federal government is trying to crack down on them.
Our military veterans with GI Bill benefits have been mercilessly targeted by these colleges. No self-respecting high school guidance counselor should ever allow a student to apply to a for-profit college. They are more expensive (read more loan) and offer no better a program than can be found at any of Maine’s community colleges.
Moreover, the for-profits target students and families who are first-time college seekers with lower academic preparation and are less likely to understand the total cost of financing required to actually earn a marketable degree. On the upside, some of the Ivy League schools with billion dollar endowments are making a commitment to no-loan, four-year financial aid packages.
Regarding the recent congressional debate over whether to continue subsidizing low-interest rates for subsidized loans, holding the rates low should be the first step in what should become a top-down total reform of the system. Huge money has been made over the years by student loan servicing companies. It’s time to reform the system so the subsidized billions benefit the student borrower rather than those aggressive collection servicing agencies.
If I had the power, the first reform step would be to fully fund students without loans for the first year to protect those many college “false starts” from finding themselves out of school with little or no credit and owing for classes they never finished. They will likely never go back to college. This reform could be accomplished by consolidating the guaranteed student loan maximum allowed amount over three years instead of four. This is not a new idea. One of the more egregious examples of college abuse of the system I can remember was seeing first-year students being kicked out of community college but having to sign their student loan promissory notes during the exit process for the school to get the tuition money still owed for incomplete classes.
There needs to be far better consumer protection for our students and their families. The megabillions they now owe are still financing our colleges and universities to operate in the style they now enjoy — think about those huge University of Southern Maine raises.
This is unsustainable, unfair and patently, fiscally corrupt and irresponsible. To make matters worse, student loans are exempt from bankruptcy relief so we have senior citizens going to the nursing homes and cemeteries still a debtor. RIP you college flunk-out loser. The most successful financial aid system in history remains the WWII GI Bill that enriched the lives of the “Greatest Generation” and paid the nation back many fold in increased productivity and tax revenues.
Peter Duston is a college counselor from Cherryfield.
It’s to bad so many go to college and never serve in the military. Eight years of service for a degree of your choice would work great. Instead we have an entitlement minded bunch of brats who have no idea what the meaning of personal responsibility is.
Except, of course, that the current policy of engaging in a permanent state of war means that the ultimate price may be paid–death in combat.
Please remember in this day and age military service is voluntary.
My comment was in response to Mapleton man, who said “eight years of service for a degree of your choice would work great.” Military service is not optional when the military pays for one’s college education.
I don’t think I understand.
The point was made that college is extremely expensive.
Someone else noted that if you join the Army, they’ll pay for college. The Army does require you do go wherever you are told and to fight in whatever war happens to be in progress for the 8-year duration of your time with them.
I pointed out that one side-effect of joining the Army in order to have them pay for college can be death–the American military is engaged in a permanent state of war that does not seem likely to end soon.
When costs rise well over family incomes, NO amount of “personal responsibility” will earn a student a degree. The idea that only those who serve in the military should have the opportunity to go to college is unenlightened, at best.
Except that the current group of things (I’m afraid if I put what I really thought of all of them my comment would be deleted) in DC is constantly targeting the benefits that Military Men & Women EARN. While I was in the service I took advantage of the tuition assistance money and took a lot of the classes I needed for a second degree. When I got out, I had paid my $1200 for my GI Bill and I was able to use it to obtain finish my second degree and begin work on a Master’s degree. Your idea sounds great in theory but unfortunately I don’t see it going far.
The BDN needs to do an exposé on how our dear Senator Snowe made her millions in Washington. Her husband is the CEO of a large group of for-profit colleges that have been ripping off student loans for many years. Guaranteed student loan monies have been flowing from students to the Jock McKernan (Mr Snowe) colleges, unethically and improperly enriching both of them.
The bank lobby as well as the lobby representing processors and collector (often bank subsidiaries) have been fighting hard to keep the guaranteed loans coming. It’s one of the best deal going for the banks. Loan initiation occurs at the school, they get interest checks from the Feds when the student is in school, they get an inordinately high interest rate, subsidies to process the loans and they don’t care if the student pays or not because loans are federally guaranteed.
The banks get rich, the processors get rich, the schools get rich, and the politicians get rich. The students, not so much…
I think that people need more responsibility. I have a college degree it took me 8 years to earn it because I had no more so I worked. On and off and went to college on and off. I graduated Summa cum laude – top 2% of the university. It took my husband 7 years to complete his undergrad degree. He went on to graduate school and we both do very well – and except for our mortgage we are debt free. People can leave frugally, go to state schools, not spend so much. We lived in places that weren’t always very nice. We often ran out of money and had oatmeal for supper more times than I like to think. A movie or dinner was such a rare event; I remember each and every time perfectly. We did without to save for our future and our parents did NOT help us out. It wasn’t that long ago. Check out the tuition and one of our two year community colleges and then transfer to a four yer college. That is what both of us did. There are affordable options out there.
“People can leave frugally, go to state schools, not spend so much. We lived in places that weren’t always very nice.” …the issue here is, that, as costs of college tuition, housing, food and transportation outpace family incomes, the option for students to earn a degree in the way you describe is lost.
Interestingly, “state schools”, as you say were better funded by taxpayers than they are today — those “state schools” have shifted the burden from society to students themselves. (Again, at a time when incomes are losing buying power from all sides.)
We will never solve this problem by ONLY looking at students/families. It’s about “responsibility” alright, but for society too.
Why do you feel it is a societal issue? I’m curious…not trying to be demeaning…just looking for another point of view.
I may chime in, in my view it is in the interest of America to have an educated population and workforce. These days, all too often, that can be achieved only at ruinous personal expense… except for the offspring of the 1%, to whom college expenses, no matter how exhorbitant, are barely noticeable.
Thanks for responding! I agree with the point that it is in America’s best interest to have an educated population and workforce. But can’t that be obtained through use of the community college system and the state universities? I’m a public school kid (Brewer schools) and a public university graduate (UMaine) and I’ve turned out just fine. Again curious to hear another’s opinion (and not get trashed for asking).
Sadly, the cost of community colleges and state universities has been rising exponentially.
I went to public schools, and UMaine, too! Tuition has outpaced inflation 600% since, and family incomes have gone down. I believe in public universities and community colleges, but they are becoming out of reach as well. As they remain “public” institutions, they are a societal concern.
Thanks for your response. I’m guessing, based on what I’ve seen, that Maine has suffered a whole lot more than the area in which I currently live when it comes to the loss of family incomes or the stagnation of the incomes. It is hard for me to judge the increased cost of the schools because we pay out of state tuition and have been lucky enough to have a son that has secured additional merit based scholarships to cover the increases. What we have felt is the increased costs of travel to and from the school.
I’m not sure I have a concrete answer on how to change the current system. I’m not sure that we could get a true consensus of a majority of people in this country anyway. Sad isn’t it? I wish we could have more respectful conversations where each side could speak and then calmly listen to the other side…where we could have a forum that promotes ideas and not hate/discord….I guess I can keep dreaming.
We all have to keep dreaming — and trying! :)
Of course — I’m happy to elaborate. I do believe that society has an interest in educating its population, whether we do it publicly, outright, or structure our educational system in such a way that our young people can apply themselves and achieve a degree.
My deep concern, is that as we slash public Universities, shifting costs once borne by society to students themselves; as we see family incomes further plummet…. …as the limits of “personal responsibility” are reached; when no amount of hard work/sacrifice etc. can earn enough… people are still focused on the students themselves, and ignoring the fact that they do not enjoy the societal support our parents’ generation afforded us.
It is a hard question with many issues. I don’t think many would mind helping the struggling student/family who is frugal and working hard but still needs help. However, if someone chooses a private school or out of state school (when that major is offered at a state college) and, perhaps, he has a major that is not employable and comes out with a huge debt. Why should we subsidize such a thing?
The debt problem is not one of students choosing more expensive schools. Students graduating from our public institutions are saddled with record debt, due to rising costs and stagnant incomes — there simply is no option, public or private, for working class people to attain degrees without incurring debt.
I would caution against only affording low-income students majors corporate interests are willing to pay top dollar for. Such an idea undermines the purpose of an education; to build minds, not just careers. Our country is much better off building minds in a variety of disciplines, and not permitting corporations to use our educational resources to offset their own training costs.
It is partially some people choosing expensive schools. A person in my family wanted to attend a very expensive Ivy League college. He was, also, accepted at UMO. The cost difference was tremendous. He’ll graduate from UMO with no debt. That would not have been the same if he had chosen the Ivy League College. He works 30 hours a week – it will take him 5 years rather than 4 because he works. He did receive some scholarships but not an extraordinary amount.
UMO does accept some credits from EMCC. Doesn’t it make sense to take what you can at EMMC – like basic English – Psychology – basic Math at $86 a credit hour at EMMC rather that $279 per credit hour at UMO? One has to be wise about it; however, UMO has a great website that states what will and what will not transfer evenly.
I think if people reduce where they can, work when they can, maybe spread their education out over more than 5 year – they may not be debt free; however, they will be less in debt than they are now.
We owe it to our youth to help them explore other options and to make it work for them. They need a future full of hope not debt and our culture needs them. I received an Associate Degree and then worked a few years and saved my money. I then went back to obtain my Bachelor’s degree. When I did, because of my Associate Degree, I could work and I had good benefits and much better pay than the average college student. It helped me live and pay my own tuition. It took 8 years but I achieved it. We don’t necessarily have to think – high school 4 years – college 4 years (with debt). By the time I had my bachelor’s degree I had no debt and lots of work experience. I had shown my determination to make the best of things and succeed. It helped me to land a good job in a tough job environment. There are other choices and options out there. They should be explored.
We should always explore all the options — students should always do what they can. When I went to UMO, though, I worked over 30 hours per week, minimum wage… Even then, when tuition was lower, it barely made a dent in my tuition and living expenses. If it weren’t for my family, I would have had to borrow.
You “worked a few years” and saved money before achieving a Bachelor’s degree? In our era of mass unemployment and low wages, that well has gone dry for too many
“I think if people reduce where they can, work when they can, maybe spread their education out over more than 5 year – they may not be debt free; however, they will be less in debt than they are now. …” People are doing just that — and it is still becoming harder, if not impossible — to pay living expenses let alone tuition.
Look at individual responsibility sure, but also at the way we structure our society.
You are correct. Families today do have to help out their children more now. The cost of higher education has been increasing substantially. I never mind helping people who are trying.
Now that you have made me think of it more I guess what bothers me is we drive vehicles with close to 200,000 miles on them, and we have NEVER brought our kids to Disney World, etc. A vacation is camping – if that – mainly visiting siblings/grandparents for free. We forgo all of this to be able to help our children with college. As I see people with newer cars, bigger houses, and taking vacations needing to borrow money for college and then have their children default on their loans – I think – so be it.
But as you say, there are those people trying hard and doing what they can. It is a tough situation. Maybe we need a whole drastic change – like the 100 and maybe 200 level classes more accessible at a lower rate – like the $86 per credit hours at EMCC. Shuttles for students going back and forth so they can take what the MUST at UMO and go the cheaper route for routine classes at EMCC. When you are picking out classes at UMO – list the equivalent courses at EMMC right there on their website. Why should two state schools be in competition? Can’t they work more closely?
I paid for my own college (actually I’m still paying for some of it). My husband and I have scrimped and saved so that we are paying a large majority of our son’s college education so he doesn’t have to take out so much money in loans. We don’t buy what we can’t pay cash for and we have no debt. We also don’t have a vehicle that is less than 10 years old. I know that paying for their children’s college education isn’t an option for a lot of parents and we consider ourselves very fortunate that our son was able to get merit based scholarships. He attends Maine Maritime, which is an out of state school for us but Virginia (where we are currently stationed) does not have a maritime school. I volunteer as an advisor for my sorority at the College of William and Mary and see young women that are majoring in art history, psychology of organizations etc and they are paying close to $40,000 as out of state students. They are neck deep in debt when they leave and most cannot get jobs that cover their living expenses plus the monthly loan payment. For many this is sticker shock. I personally think that parents, school counselors and the student need to have frank conversations about majors, college costs, college options and expectations (est. loan payments, expected job placement, expected salary of a recent grad) long before everyone gets caught up in the choosing of a college rush. We started those discussions with our son when he was a sophomore and it was probably pretty late to be honest. But my son will make more than enough to live on his own, buy a new vehicle and make the payment on the student loans he did take and still have money to invest in his retirement and savings. So what’s my point? Do we think it is reasonable for a student to choose a $45,000 a year out of state school to get a degree in a field where a starting employee only makes $20,000? Doesn’t make sense to me…
If he’s going to MMA then you all did a wonderful job helping him decide where to get a good education as I know that the job placement rate for graduates from there is in the high 90%. I only wish that I’d known what was available from that school when I graduated from HS. I live 15 miles from that school but as the first college attendee ever in my family my parents didn’t know the ins-and-outs, my counselor in high school didn’t know what she thought she did, and I was not as educated on the matter as I should have been; which I take much of the responsibility for. The only good thing that I’m getting out of this is when I have kids I’m much more aware of what actually goes on so I’ll be able to advise against many decisions that have the deepest pitfalls. (Like going to a private school. facepalm*) As for education itself, most of what I learned I could have learned on the job and the classes need to be looked at as well. To many classes are junk and a just a way to make money for the University or college. I mean, I was a business major and had to take an Anatomy class with a lab. What exactly that had to do with running a business I still haven’t figure out. Was a great way for the school to make $2K + the cost of the text book though..
I grew up in Brewer and graduated from UMaine. As soon as he said he was interested in the maritime industry I brought him home (ok so there was some ulterior motive as my sisters still live in Bangor) to look at MMA. The small campus atmosphere and the closeness to relatives along with the placement rate for graduates were huge for my son. Where we are stationed (Norfolk area) there is a huge port and tons of shipping opportunities so when he finishes school he feels pretty confident he’ll get a good job. We’ve also been very fortunate because he is a good student so he’s been able to obtain several merit based scholarships.
I majored in Communications at UMaine and they made me take Biology & Zoology. I guess it was meant to make us a well rounded individual. LOL! But I do agree with you that it is difficult to navigate the “system” if you are the first generation to attend school and get a degree! My counselor had best of intentions but was no help…neither were my parents (neither of which graduated from college) since I had several sisters coming behind me in rapid succession. If I wanted to go to college then I was on my own.
I also agree that many of the courses I took at UMaine, UMaryland (while in the service) and Old Dominion University were not worth the time and effort I put into them. I have enjoyed the courses that I’ve taken from my local community college far more (and learned a lot more). Most of my professors have actually worked in the industry they are teaching about and are able to show how the course actually applies to the day in day out job responsibilities. I wish that more high schools would have Industry Days and actually bring in people in various career fields to speak about what kinds of degrees and experience the kids need to be successful. To speak frankly about salary expectations and length of time it takes for upward career progression. To me this goes hand in hand with the decision making process for choosing a college and a degree.