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Allow Extra Processing Time For Private Education Loans (Reg Z)


Summer marks a great time to be traveling on vacation, having cookouts with friends and family, and hanging out by the swimming pool. However, it is also the time of year when Fall billing statements are sent by colleges and universities around the country. I am sure if you had your choice of summer activities, paying your fall tuition bill would probably rank pretty low. But, before you put that tuition bill on the back-burner, it is important that you know the time frame that you may encounter if you are using private education loans to cover your college expenses.

Last year (February 14th to be exact), the Higher Education Opportunity Act implemented regulation Z which mandates that a series of disclosures be distributed to borrowers at key steps throughout the private education loan process. The underlying goal is to make sure students and families exhaust all of their federal loan options before moving forward with a private education loan. In addition, the disclosures serve as an educational tool to help borrowers fully understand the terms of their loan program.

There are multiple disclosures that you should encounter when applying for a private education loan:


  • Loan Application and Solicitation Disclosure: Schools or lenders are required to provide general information about loan rates, fees, and terms and must also inform a prospective borrower of the potential availability of federal student loans and the interest rates for those loans, and where to locate additional information.
  • Loan Approval Disclosure: When the school or lender approves the borrower’s application for a private education loan, they must give the borrower a transaction-specific disclosure, including information regarding the rate, fees and other terms of the loan including total repayment figures (very similar to the 1st disclosure). However, at this time, they must also notify the borrower that the rates and approval are good for 30-days. This allows the borrower time to shop-around… This disclosure is required for a first time loan as well as a private student loan consolidation.
  • Self-Certification Form(Designed by the Department of Education): Must be completed by the borrower and collected by the lender/school prior to any private loan disbursement.
  • Loan Consummation Disclosure: This, again, is very similar to the other disclosures already received by the borrower regarding terms and rates. The only additional piece of information that is provided is the 3-day right of refusal clause. Which means that funds can’t be disbursed to your college until after that Loan Consummation Disclosure is provided.

I am not sure what you think about all of these disclosures but it is starting to remind me of the paperwork that is required to be signed and initialled at a house closing. It could be very easy for your eyes to glaze over through this process but the disclosures do serve a purpose and the information provided on them is helpful when you are are trying to discern your total education loan indebtedness.

If you are getting a private education loan to cover your college expenses, the important thing for you to do is start the process as soon as possible. The earlier you get your loan paperwork complete (and all the disclosures filed away), the better your chances of meeting any payment deadlines imposed by the college. And, as we all know, paying by the due date does have it’s advantages — no late payment penalty fees and your registration doesn’t get cancelled. 😉

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The College Ranking That Nobody Wants To Be On


Holding true to the Higher Education Opportunity Act legislation, the Department of Education has started it’s own ranking system for colleges and universities. It is called the College Affordability and Transparency List (or CATL for short).

The government has always asked colleges and universities to report statistical data (including costs) every year through the IPEDS survey (Integrated Post-secondary Education Data System) but this is the first year that the financial data will be made widely available for families to sort through, compare, and contrast based upon specific criteria.

The purpose of this list is aimed at highlighting the schools that have the highest prices AND the highest rate of price increases. Schools at the top of this list for the three year period preceding the release of this list will be required to submit additional reports to the Secretary of Education. From what I understand, over 500 colleges will be required to execute the additional reporting piece this year.

The statistics of the data being presented are a little shocking (maybe even mind-numbing) but numbers don’t lie and usually speak for themselves.  Should you use this data to help you in your college search process? Maybe, but I would probably advise against it. These numbers are already a couple years old and since they provide a statistical average, your individual financial outlook at one of these colleges may actually be better or worse than the average.

Below are a few different categories that I pulled from the CATL report. If you would like to play around with the data and run your own reports or check out your favorite college or university to see where it stands amongst the others, click here to give it a whirl.

4-year Private Schools With The Highest Percentage Increase In Tuition From 2008-2010

Institution State 2007-08 2009-10 % Increase
Wells College NY $17,810 $29,680 67
Frank Lloyd Wright School of Architecture AZ $18,585 $30,100 62
Charles Drew University of Medicine and Science CA $7,100 $11,300 59
Sage College of Albany† NY $18,440 $27,790 51
John Dewey College-University Division PR $3,560 $5,000 40
International Baptist College AZ $6,930 $9,660 39
Jamestown College ND $11,535 $16,006 39
Trinity Lutheran College WA $14,170 $19,425 37
Bluefield College VA $13,180 $18,020 37

4-year Public Schools With The Highest Percentage Increase In Tuition From 2008-2010

Institution State 2007-08 2009-10 % Increase
Northern New Mexico College NM $1,668 $2,522 51
Florida State College at Jacksonville FL $1,714 $2,553 49
San Diego State University-Imperial Valley Campus CA $2,906 $4,260 47
Georgia State University GA $5,147 $7,498 46
California State University-East Bay CA $3,345 $4,872 46
California State University-Stanislaus CA $3,330 $4,840 45
California State University-Chico CA $3,690 $5,336 45
Alabama State University AL $4,508 $6,468 43
California State University-Northridge CA $3,350 $4,801 43


4-year Private Schools With The Highest Net Tuition Price (after financial aid)

Institution State Net Price(1)
Art Center College of Design CA $39,672
The New School NY $39,004
School of the Art Institute of Chicago IL $38,965
The Boston Conservatory MA $37,798
California Institute of the Arts CA $36,997
Manhattan School of Music NY $36,208
Rhode Island School of Design RI $35,991
Pratt Institute-Main NY $35,506
Santa Clara University CA $35,245
Northwestern Health Sciences University MN $35,062

4-year Public Schools With The Highest Net Tuition Price (after financial aid)

Institution State Net Price(1)(2)
The University of Texas Health Science Center at San Antonio TX $24,192
University of Guam GU $23,902
St. Mary’s College of Maryland MD $21,468
Rowan University NJ $19,344
Miami University-Oxford OH $19,305
Pennsylvania State University-Main Campus PA $19,056
Pennsylvania State University-Penn State Altoona PA $18,878
Pennsylvania State University-Penn State Erie-Behrend College PA $18,857
University of Pittsburgh-Pittsburgh Campus PA $18,786
Pennsylvania State University-Penn State Berks PA $18,048

4-year Private Schools With The Lowest Net Tuition Price (after financial aid)

Institution State Net Price(1)
Universidad Teologica del Caribe PR $82
Talmudical Academy-New Jersey NJ $469
Colegio Pentecostal Mizpa PR $1,776
Baptist Missionary Association Theological Seminary TX $1,876
John Dewey College-University Division PR $1,956
Turtle Mountain Community College ND $2,031
Pontifical Catholic University of Puerto Rico-Ponce PR $2,208
Southeastern Baptist College MS $2,699
Mesivtha Tifereth Jerusalem of America NY $2,839
Our Lady of Holy Cross College LA $2,874

4-year Public Schools With The Lowest Net Tuition Price (after financial aid)

Institution State Net Price(1)(2)
Sitting Bull College ND $938
Escuela de Artes Plasticas de Puerto Rico PR $995
South Texas College TX $1,317
University of Puerto Rico-Aguadilla PR $1,591
The University of Texas-Pan American TX $1,646
Indian River State College FL $2,138
University of Puerto Rico-Bayamon PR $2,345
California State University-Dominguez Hills CA $2,451
California State University-Los Angeles CA $3,263
Elizabeth City State University NC $3,335

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The Future of HEOA & How It May Impact You


The Higher Education Opportunity Act has certainly set the wheels in motion to help wrestle with some of the more undefined or ambiguous aspects of Higher Education. At CheapScholar.org, I like to focus more on the financial aspect of this legislation (since our motto is “Helping to Make College Affordable”).  I have already discussed how these new laws will be impacting the purchasing of textbooks (in a positive way) and also how it will help families to accurately compare the cost of one college to another.  Today is the last article that I am going to write about HEOA (at least in this series) and I would like to focus on the future of HEOA and how it may impact you (from a financial aspect).

The Future of HEOA

While this piece of legislation was going through the drafting phases, a good number of “price controls” didn’t make the final draft but that doesn’t mean that they won’t make an appearance on a future version of this bill. The following represents some initiatives that are being considered by the federal government to help mitigate future increases in education costs:

  • No longer provide Title IV funding (federal financial aid) other than Direct Loans and Pell Grants to schools that increase tuition rates by more than twice the rate of inflation. While this seems like a logical proposal, my guess is that the reduction in this funding may actually hurt students (financially) than help. Some schools heavily depend on Title IV funding to balance the budget each year. If these funds are not available, they may be forced to pass the costs onto the students in the form of fee increases or program reductions/cuts.
  • Require Additional Reporting to the Department of Education from institutions that exceed the “college affordability index” for three or more years. This proposal is actually set to be in place by July of 2011 but the details are still being hammered out. Schools that meet this criteria will have the additional review from DOE but will also be reported to their accreditors, and be subject to an audit by the Inspector General.
  • Establish Third-Party Oversight Committees to review operations on the top 5% of campuses that have the highest cost of tuition increases. These committees will pull “experts” from various sectors of Higher Education and try to identify any areas of spending on campuses that can be contained or better controlled.
  • Require schools to report net price information with all admission materials.  This may be beneficial for those that aren’t accessing the online net price calculators but it could be quite challenging for admission offices to have the most current information on all of their brochures.

Even though the legislation above is still on the drafting board and has not made it into law, it is good to know that the education division of our federal government (DOE) is still working to implement measures that will help to make college affordable (and accessible) by all regardless of socioeconomic status. My only hope is that they implement the right legislation for the right reasons and just don’t create some more bureaucratic hurdles that ultimately don’t help students and saddle down colleges with burdensome reporting requirements. I guess time will tell…

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HEOA – College Pricing Calculators and Transparency Lists


If you are a college student (or about to become a college student) you probably already know that trying to figure out the best college to attend strictly based upon price is a very difficult task. There are a multitude of variables that come into play and inevitably you are never able to compare apples to apples when calculating the cost of one institution verses another. The Department of Education has recognized this issue and is implementing some legislation through the Higher Education Opportunity Act to help make things a little simpler (or so they say..)

Net Price Calculators For All

By October of 2011, all colleges and universities will need to have a Net Price Calculator established and available on their websites. They can use the free template provided by the Department of Education or they can create their own program as long as it includes the same perimeters provided by the Department of Education’s template.  It is unclear which approach most institutions will be utilizing but they will need to have something in place by October of 2011 if they are to adhere to the legislation and maintain their access to Title IV funding (Federal Financial Aid).

These online calculators will use preset data provided by the school and inputted data supplied by the student to come up with a net figure that the student can expect to spend if they attend that college. As you can imagine, there is no perfect formula that can be applicable to all students, so you will need to take the figures with a grain of salt. Basically, the net cost calculator will compare your financial situation to that of similar students from the prior year and tell you the average amount spent by those students (Cost of Attendance minus Financial Aid).

What is really nice about these net cost calculators is that students will now have the opportunity to get past the sticker shock of the schools they are interested in and look at what comparable students attending that school are actually paying out-of-pocket after financial aid is factored in. This is sure to take a lot of the guesswork out of the financial aspect of your college search process. The only significant downside I can see to this program is that it is only as good as the data provided by the school (and I guess the student). So, if the school misrepresents (miscalculates?) something in the net price calculator tool or the student inadvertently provides the wrong information, the net price figure may be drastically off from what the end result actually turns out to be (the amount of the check from your checkbook).

The First College Ranking That Nobody Wants To Be On

Colleges and Universities love to be at the top of ranking lists. Some schools even actively make decisions on their campus based upon the outcome they think it will have on some of these rankings.

Well… the Department of Education is introducing it’s own ranking and it is called the “College Affordability and Transparency List” (CATL). This list will be published by July of 2011 and it is aimed at highlighting the schools that have the highest prices AND the highest rate of price increases. Schools at the top of this list for the three year period preceding the release of this list will be required to submit additional reports to the Secretary of Education (kind of like being summoned to the Principal’s office..never a good thing).

Click Here To Access The List

I am really unsure how the Department of Education will be calculating these figures but I can guarantee you that no college or university wants to be on this list and will do whatever possible to steer clear of being in the top ranking slots.

Ultimately, I think these changes in legislation are a good step to helping more students find the right college (academically and financially). However, I am cautiously optimistic on how this new legislation will mold the educational sector for the long-term. For example, if a college or school continues to be at the top of the CATL, will they eventually lose partial or full access to federal financial aid? I know that this would be of great detriment to the school but I think it would probably financially impact the students attending that school even more… I guess time will tell. For now though, lets enjoy these new legislative initiated tools that help us to make the college experience affordable.

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New Higher Education Opportunity Act (HEOA) – Reducing Textbook Expense


Over the course of the next week or so, I am going to be introducing some different aspects of the new Higher Education Opportunity Act. More importantly, I am going to focus on the parts of the bill that impact you (and your checkbook) as it relates to the financial aspect of your college experience.

For those that don’t know, the Higher Education Act was initially put into law back in 1965. This expansive legislation tops out at 431 pages and provides guidelines for colleges and universities that must be followed if they are to maintain their eligibility for Title IV funding (Federal Works Study, Pell Grants, Direct Loans, SEOG, etc…). In the past year or so this legislation was completely revamped and all the new laws went into effect on July 1st. In most cases, this legislation is focused on benefiting the students and their families. In other aspects, it just ends up being a bunch of bureaucratic red tape that gets in the way of anybody getting anything done. All in all though, it impacts the world of higher education and ultimately the students (again.. mostly for the better).

Today I am going to focus on how HEOA is impacting Textbooks (and possibly what you will be spending on them).

In the past, finding out what textbooks you needed for a particular course was likened to the process involved to find out if Colonel Mustard was responsible for all the mischief caused in a game of CLUE. Meaning, you find yourself going in circles only to find bits and pieces of the information you need but never really getting a clear answer from anyone. Here are some sample “hurdles” encountered by students; the book titles are never complete in the course descriptions, the professors never told them all the “extra” reading material that is required for the course, and the edition of the book is undoubtedly always incorrect and heaven forbid you actually get an ISBN number…

What this meant to students before the most current HEOA is that they were kind of at the mercy of the college bookstore for all of their textbooks and they really didn’t have an opportunity to shop around at other discount retailers. Now that HEOA is in effect, all of this should now change.. How so you ask? Let me tell you…

Good News For You!

When students register for courses, the following two items must be made available to them (“to the maximum extent practicable”) at the point of class selection:

  • ISBN numbers for all books associated with the class: Now that ISBN numbers are available in advance, a student has the opportunity to get the book (the correct one) for a discount either through an online resource or potentially from one of their classmates that recently took the course.
  • Suggested Retail Price for textbooks AND supplemental materials: This is important because you can have two sections (taught by two different professors) of an accounting course available and immediately see that one is requiring $150 in books and supplies and the other one is only needing $75. Immediately you can achieve a $75 savings just by picking one section (professor) over the other.

Bad News For Colleges!

Very few colleges and universities seem to manage their own campus bookstores anymore. Most of these sites are outsourced to companies like Barnes and Noble and Follett. Since they are outsourced, the only revenue the schools get is usually some rental income for space they lease to the company and a percentage of the gross sales revenue (which is usually tiered.. meaning the more the bookstore makes, the more the college gets). With the implementation of HEOA and the new textbook provision, it seems to be very natural that campus bookstore sales will probably be taking a hit and therefore so won’t the school itself.

Ultimately, I think this legislation is going to be a mechanism to help bring textbook pricing under control. Anyone that has purchased textbooks in the past couple of years can attest to the inflated cost associated with these specialized books. I remember when I was in college paying close to a $100 bucks for a book once. I felt justified in the expense because the book was a hardback. Now I walk through the bookstore and I see the same prices for paperback… times have certainly changed. Anyway, I hope you find some benefit from this information and you take advantage of the changes in HEOA in regard to textbook pricing.

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