It happens every spring: Families receive financial aid offers from colleges, wonder about them, and are always left with the question: How much will this college really cost me?
Instead of stating how much a family must pay out of pocket, some letters use jargon like “total net expenses” or “total net and indirect costs.” Different colleges calculate a student’s out-of-pocket expenses differently, and because letters are available in hundreds of formats, families may have difficulty determining which institution is most affordable. Sometimes the letters don’t reveal the high interest rates behind the loans they mention or that families might not qualify for them. This can result in students having to pay much more money – or take on more debt – than expected.
For more than a decade, student advocates have lobbied Congress for a solution, and last year a bipartisanInvoicegained momentum. It required colleges to use a uniform financial aid offer letter and uniform cost definitions, so families could know what they would owe — and which school offered the best deal. Student advocates liken the requirement to nutrition labeling: the federal government would step in to make sure consumers understand what they’re getting.
But what seemed like a simple effort to simplify comparing college costs — an effort that initially drew rare agreement from politicians and advocates on the right and left — was changed this week in a way that frustrated student advocates. A revised bill, introduced Wednesday, requires colleges to use the same definitions for loans, grants and total cost. But after university associations lobbied against the standard letter, politicians who had previously supported the requirement removed it. In fact, the newInvoicespecifically prevents the Department of Education from requiring a standard offer letter and allows colleges to provide website links for certain information, rather than including all the details in the letter itself. Additionally, student advocates worry that the revised bill would make it easier for colleges to offer private loans, which would provide students with fewer protections.
“They made a lot of changes that didn’t center students but instead favored industry and higher education associations,” said Rachel Fishman, director of higher education at the liberal policy group New America. “There could have been some sort of compromise, but it went too far in favor of the institutions. »
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The attempt to change the originalInvoiceknown as the “Understanding the True Cost of College Act,” has intrigued student advocates because Congress and members of the Trump administration have both argued that colleges should be held accountable. Last summer, Congress limited student loan eligibility, so colleges could lose federal funding if their graduates don’t earn enough. Many advocates believed that standardizing financial aid letters was the best way to protect students and were surprised when Sen. Bill Cassidy, the Louisiana Republican who chairs the Senate Health, Education, Labor and Pensions Committee, offered an amendment to change it. More than a dozen student advocacy groups have written aletterprotesting against the changes, while collegial associationsrentedCassidy’s version of the law to improve financial aid offerings to students.
Cassidy’s office did not respond to requests for comment. Aides to Sen. Charles Grassley, the Iowa Republican who sponsored the original bill, said he would support the new version because it maintains the requirement that colleges use the same definitions for key terms and that all upfront costs be listed on offers.
Some conservative advocates supported retaining the uniform offer letter.
“I’m 100 percent in favor of using a formal boilerplate letter. That’s what we do for mortgages: If you’re getting money from the federal government, they should be able to dictate what that looks like,” said Preston Cooper, a senior fellow at the American Enterprise Institute, a conservative think tank. “There are very serious abuses and ways of listing prices and loans that are misleading. »
College associations, for their part, say they agree that offer letters should use the same terminology, but that a uniform approach would prevent their members from writing offer letters that are directed at specific students they are enrolling in. For example, community colleges generally do not require loans, while research universities do. They support the new bill and highlight ainitiativethey lead in promoting standards for offer letters and help schools clearly explain letters to families. So far, more than 750 of the nation’s roughly 4,000 colleges are using the initiative’s principles, according to Emmanuel Guillory, senior director of government relations at the American Council on Education, which represents colleges and leads the transparency initiative.
“Every institution is different. They don’t offer the same programs, they don’t have the same mission, they don’t have the same size, they don’t serve the same students,” Guillory said. “So how are you going to have a mandatory offer letter that is exactly the same when institutions are offering different types of aid?”
Related: How much will this university cost you? Good luck figuring it out
Supporters argue that the difference between institutions is one reason letters should be uniform, because this lack of clarity can put students in a bind. Jean Aimable applied to more than a dozen colleges last year, looking for a school with quality academic programs and where he wouldn’t end up in debt. Brandeis University seemed to fit the bill: the offer letter he received showed that he wouldn’t need loans, but he would need a work-study job.
But when he arrived on campus in Waltham, Massachusetts, and applied for more than a half-dozen work-study positions, none were available. “I couldn’t get one,” said Aimable, a Commonwealth High School graduate. “Even if it shows up on your federal aid letter, that’s not necessarily money you’ll get.”
Last fall, he had to scramble to secure a loan to cover the deficit.
A Brandeis spokesperson said it participates in the college association’s transparency initiative and its letters provide hyperlinks with information about its work-study program. The university’s website does indicate that work-study jobs are not guaranteed, but it is on a page in a drop-down menu.* Student advocates argue that all information regarding the amount a student will be required to appear on the letter itself should be clearly displayed.
“We are constantly refining our letters and outreach activities to ensure students have the most accurate and useful information possible,” Brandeis spokeswoman Michelle Gaseau wrote in an email.
In 2022, the federal government issued a damning advisoryreportWhen it comes to college offer letters, we find that 91% of schools underestimate or don’t include the net price families will pay in their offer letters. This could lead students to “make uninformed and costly decisions, such as enrolling in an unaffordable college,” the Government Accountability Office said, adding that “additional action by Congress would be necessary to ensure that all students receive the information they need in their financial aid offers.”
Areportpublished in December by uAspire, a nonprofit organization that advocates for college affordability, discovered 11 different ways colleges calculated the final cost for a student. Some have subtracted grants and scholarships from tuition, while others have subtracted grants and loans from full tuition (which includes room and board). Although the authors noted some improvements since a 2018 studyreportAfter helping write on the topic, they concluded that the lack of a uniform method of calculating and presenting costs posed significant problems for students.
“There is a need to be able to make a comparison between institutions so that students can weigh the pros and cons of schools with a clear idea of finances,” said Anika Van Eaton, vice president of policy at uAspire and one of the authors of the report.
Related: Why do prices increase more for low-income students than for their higher-income peers?
The burden of decoding letters may be heavier for students who are the first in their family to go to college. For Aliah Ramos, like many students, college choice came down to price, and it was difficult to figure that out for herself.
“Not coming from a family that really knew what the FAFSA was, not knowing how to parse financial aid offers or even how to apply to college, I needed to find people to help me with the letters,” said Ramos, a freshman at the University of Massachusetts Lowell, referring to applying for free federal student aid.
Associations fear that putting a uniform letter into law would make any future changes very difficult, whether due to technological advances or new loan programs.
It appears unlikely that the original bill will advance through Congress. If Senator Cassidy’s bill passes, it will have to be reconciled with a separate bill.effortreform of offer letters which is moving forward in the House.
It remains to be seen whether next spring, families of high school graduates will still be perplexed by offer letters and wondering which college they can afford.
*Clarification: An earlier version of this sentence, based on information from a Brandeis spokesperson, stated that information about work-study jobs appeared on an FAQ page on the university’s website in one of 16 drop-down menus. After publication, the spokesperson clarified that offer letters include a hyperlink to two drop-down menus containing information about work-study employment.
Contact senior investigative reporter Meredith Kolodner at kolodner@hechingerreport.org or on Signal: @merkolodner.04.
This financial aid story was produced by The Hechinger reportan independent, nonprofit news organization focused on inequality and innovation in education. Register for the Hechinger newsletter.
The article Confusing Financial Aid Offers Can Leave Families Deeper in Debt. Student groups say a new fix doesn’t go far enough, which appeared first in the Hechinger report.
