White House officials announced a new “Know Before You Owe” financial aid shopping sheet to calculate how much money students would have to pay back for loans after they graduate from college.
The shopping sheet, which will go into effect in fall 2013, will make financial aid offers easier to understand by creating an outline specific to each student’s net cost of college after grants and scholarships are awarded.
College presidents and officials from 10 different colleges and universities were invited to reach an agreement for the shopping sheet. The participants also made a commitment to provide their students with this deal.
President F. King Alexander was invited to attend the White House meeting to discuss the shopping sheet but was unable to attend.
“It’s hard for us when you get a call on Friday to your office, and they say can we get here Tuesday morning,” Alexander said.
Although Alexander was not in attendance, the Obama administration has been contacting him for his input on the shopping sheet because the Cal State University system has already been using its own form of one.
“We’re very supportive of it,” Alexander said. “We’ve been doing this for four years but not only this but more. We were encouraging the White House to catch up to us.”
Cal State Long Beach’s version of the shopping sheet can be found under the public goods page on the college portrait page. On the public goods page, a student can compare the price to attend CSULB with other universities in the nation.
The “Know Before You Owe” financial aid shopping sheet is a part of President Obama’s college scorecard, which will allow students to compare colleges by affordability.
Colleges will provide the shopping sheet to prospective students to increase transparency with the students’ likely debt when they graduate. The estimates will be recalculated each year as students fill out their financial aid applications.
“[Obama] is very worried about the indebtedness of student loans,” Alexander said.
Alexander said that the shopping sheet gives parents and students a clearer understanding of how much schools cost, because they tend to think that institutions charge 30 percent more than they actually do. He also said this will allow students to make a more accurate decisions on which college to attend.
“Many institutions have been part of the problem because they haven’t been forthright about repaying their loans,” Alexander said.
Alexander said that the shopping sheet was rushed due to the July 1 vote on the subsidized Stafford loan interest rate.
He also said that in the future, the shopping sheet will be adjusted from the current example provided.
“I’m not content with just adopting this template, because we’re doing so much more,” Alexander said.