Trying to improve transparency in college financial aid offers

by Grace

Last week the Obama administration announced an agreement by ten colleges and universities to provide better financial transparency, including a “financial aid shopping sheet” that will be sent to admitted students.

The sheet would simplify the current process of comparing colleges. It would clearly state the cost of a year of classes, the student’s net cost after grants and scholarships, financial aid options to pay that cost and estimated monthly payments for federal loans. It would also provide information about the colleges’ retention and graduation rates and the share of graduates who default on their student loans. 

The State University System of New York (composed of 64 colleges, universities, and community colleges) and the University of Texas System (composed of 9 universities) are among the schools participating in the new transparency initiative.

Additionally, the administration is seeking feedback for the final version of its model financial aid award letter that will be part of a planned fall rollout.  The hope is that more schools will commit to using a version of this model letter as a way to improve transparency.

Vice President Biden, Secretary Duncan, CFPB Director Cordray and College Presidents Meet About Transparency of College Costs

Related:  How to improve college financial-aid award letters

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