NASFAA Supports Improved College Cost Disclosures
FOR IMMEDIATE RELEASE
Contact: Haley Chitty
Director of Communications
Student Aid Professionals Issue Recommendations to Strengthen Financial Aid Award Letters
Washington, D.C. – Rising college costs and increasing student loan debt make it vital for students and families to have clear and accurate information about their financial aid packages and what they will pay for a postsecondary degree.
When students and families make critical decisions about which college to attend, they often rely on the information colleges and universities send them in a financial aid award letter. These letters outline students' estimated cost of attendance and student aid package, including grant and loan eligibility. However, a lack of consistency between schools’ award letters can cause confusion and make it difficult for students and families to make comparisons.
This confusion has led Congress, the U.S. Department of Education and the Consumer Financial Protection Bureau (CFPB) to explore ways to improve award letters. To help this effort, the National Association of Student Financial Aid Administrators (NASFAA) has issued recommendations to ensure award letters provide students and families with information that is clear, concise, and consistent.
The recommendations were developed by a NASFAA task force of working financial aid professionals representing every sector of higher education (private, public, for-profit, 2-year, 4-year and graduate/professional). The task force reviewed proposals from the Obama administration, evaluated sample award letters from various colleges and universities and surveyed financial aid offices for feedback. They also consulted with consumer groups, other higher education associations and student aid experts.
This information was used to develop recommendations to help standardize award letter terminology and elements while maintaining flexibility for colleges and universities to customize award letters to meet the specific needs of their unique student populations. The recommendations are detailed in a report by the task force that includes:
- specific elements award letters should incorporate;
- a glossary to standardize award letter terminology;
- additional consumer information that should accompany award letters.
The report also urges the U.S. Department of Education to develop a student loan database or aggregator to help students and colleges track federal and private student loan borrowing.
“As Congress and the Obama administration explore ways to improve financial aid award letters, we encourage them to consider the recommendations put forth by financial aid professionals,” said NASFAA President Justin Draeger. “Incorporating the recommendations of the professionals who assist students on a daily basis and have the best working knowledge of the financial aid programs will help maximize the effectiveness of award letters and avoid unintended, negative consequences of over-prescriptive standardization.”
The National Association of Student Financial Aid Administrators (NASFAA) is a nonprofit membership organization that represents nearly 20,000 financial aid professionals at 2,800 colleges, universities, and career schools across the country. Each year, financial aid professionals help more than 16 million students receive funding for post secondary education. Based in Washington, D.C., NASFAA is the only national association with a primary focus on student aid legislation, regulatory analysis, and training for financial aid administrators. For more information, visit www.nasfaa.org.