The Washington Post: “Wells Fargo is offering Amazon.com customers discounted interest rates on private student loans, creating a partnership with the online retail giant at a time when private lenders are fighting for market share.”
“Amazon Prime Student subscribers who apply for any of the bank’s education loan products are eligible to have their interest rate lowered by half a percentage point. Wells will take off an additional quarter of a percentage point for borrowers who enroll in an automatic monthly loan repayment plan. Interest rates on Wells undergraduate loans for four-year colleges range from 5.94 percent to nearly 11 percent on a fixed-rate loan and 3.39 percent to 9.03 percent on a variable-rate loan. Students who enlist a parent or grandparent on the loan can get lower rates because co-signers are obligated to repay the debt if the borrower does not.”
“As it stands, interest rates on federal student loans are at an all-time low. Undergraduate students can expect to pay 3.76 percent in interest on new Stafford loans for the 2016-2017 academic year, while graduate students will be charged 5.31 percent interest. Government loans are only offered at fixed rates and students don’t need co-signers with stellar credit to qualify for the lowest rate. What’s more, federal student loan borrowers can take advantage of the government’s income-driven repayment plans that cap monthly payments to a percentage of their earnings. There is nothing comparable in the private market.”
Pauline Abernathy, vice president of the Institute for College Access & Success (TICAS), comments: “Amazon and Wells Fargo are trumpeting a discount while burying the sky-high rates on these private loans and without noting that they lack the consumer protections and flexible repayment options that come with federal student loans. It is a cynical attempt to dupe current students who are eligible for federal students loans with a record-low 3.76 percent fixed interest rate into taking out costly private loans with variable interest rates currently as high as 13.74 percent.”
Inside Higher Ed: Tipping Point author “Malcolm Gladwell says a trade-off exists between high-quality campus dining and admitting low-income students … Letting students make do with mediocre food would enable colleges to admit more low-income students and provide them with the aid and support they need to succeed, he maintains.”
“In his new podcast series, Revisionist History, he makes this point by contrasting Bowdoin College, which is regularly cited by campus guides for outstanding food, with Vassar College, where students tell him the food is mediocre. Both are elite liberal arts colleges, with highly competitive admissions, respected faculty members and beautiful campuses. But Vassar enrolls a much larger share of low-income students than Bowdoin, and Gladwell blames the gourmet food Bowdoin students enjoy.”
“While many agree that colleges can and should do much more than they are doing now to increase the admission of low-income students, many question whether Gladwell’s focus on dining makes sense.” Bowdoin responds that it “is among the very small number of colleges that are need blind on admissions, meet full need and never use loans in any part of an aid package.” In addition: “No funds from the endowment or other revenue sources pay for dining, the college says.”
CNBC: “When students and families weigh everything that goes into attending college, not least the cost, ‘the plan B schools sometimes are a better fit,’ said Katherine Pastor, a school counselor at Flagstaff High School in Arizona.” In fact, ‘close to 17 percent of first-time freshmen were accepted at their top school and chose to attend somewhere else,” according to UCLA’s Higher Education Research Institute.
“Some 58 percent of those enrolling at their second-choice school said cost was an issue, compared with 41 percent of those attending their first choice,” according to the Institute. “Students opting for their first-choice school, in contrast, were more likely to cite graduates’ record of landing good jobs or getting into top graduate or professional schools. They were also more likely to mention their school’s strong academic record, the Institute found.”
“Pastor, the Arizona school counselor, said she hears about students who set off for their first choice, only to find that it is not a good fit … Outcomes like that can be particularly difficult if a student has passed on scholarships and aid offers from a second-choice school, and now has to restart the process. The upside may be this, however: ‘I have never heard of a kid who picked their second-choice school who has not been happy with their choice,’ Pastor said.”
BloombergBusiness: “Many students are choosing to go further than a one-semester break and attend all four years of college in a foreign city. The number of students enrolled in college outside their countries rose 463 percent from 1975 to 2012, said a report last month by Moody’s Investors Service. International students in the U.S. have grown by 70 percent since 2005, according to the report.”
“College in Europe can be astonishingly cheap for Americans. Forty public and private colleges in continental Europe offer free bachelor’s degrees, taught in English, to Americans … An additional 98 colleges ask tuition of under $4,000 per year … European colleges want American applicants because they can charge higher tuition for non-EU residents. Americans in Europe will still pay considerably less than they would at home … The main thing that holds some Americans back from studying across the Atlantic is a fear that they’ll sacrifice quality—and North American career opportunities.”
Jennifer Viemont, “co-founder of Beyond The States, a database of 350 colleges in 30 countries that offer bachelor’s degrees taught in English,” comments: “The biggest worry people seem to have is that a name from Europe won’t carry the same weight as one from the U.S., but there’s a serious upshot of graduating a year early and with a fraction of the debt. Plus, you’ve seen the world.”
A startup website called Raise.me allows students to earn scholarship credits in exchange for taking certain courses and realizing other achievements, The New York Times reports. “The start-up’s approach is a mash-up of two popular economic concepts. One is ‘nudging,’ that is designing systems to influence the choices people make, ideally for their own good. The other is microfinance — incremental loans for entrepreneurs who would not otherwise have access to funding.”
“Raise.me charges participating institutions annual fees of $4,000 to $20,000 based on a college’s size and scholarship program. Each college sets its own criteria. Penn State has made its Raise.me program available to students at five high schools in Philadelphia, as well as six rural Pennsylvania high schools. Those students may earn scholarships of up to $4,000 a year for four years. Among other awards, the university offers them $120 for each A grade in a core course, $400 for each advanced placement course, $100 for each year of perfect attendance, $100 for a leadership role in a sport or extracurricular activity and $5 for each hour of community service, up to $500.
“The potential risk is that introducing monetary rewards could curb students’ intrinsic motivation to succeed in school, or their innate enjoyment of activities like reading, in favor of striving for scholarship dollars.” However, Raise.me co-founder Preston Silverman “said that the scholarship program did not displace students’ inner enthusiasm, but rather enhanced their motivation by showing them additional ways they could prepare for college.”