The College Board Ends Its Student Loan Program

The College Board is ending its role as a lender in the Federal Family Education Loan Program (FFELP) and will not accept new loan applications after Oct. 15, 2007.

The College Board will continue to honor its obligations to existing borrowers through the 2007-2008 academic year.

The College Board’s decision to end its student loan program was based on the enactment of new legislation and codes of conduct regarding the student loan industry.

Read the full release.

SAT Scores At Historic Low

The College Board, developers of the Scholastic Aptitude Test (SAT), are reporting that average SAT combined scores are at their lowest in a decade. Average combined scores on the math and critical reading sections for the test-takers in the high school class that graduated in 2007 (all 1.5 million of them) declined for the second year in a row. This year's scores fell four points from those of the previous year. Scores dropped seven points last year.

Average scores on the math section fell three points, to 515, and reading scores fell one point, to 502, out of a possible 800 points. A record 1.5 million students took the exam.

College Board officials said this year’s decline stemmed from the greater proportion of low-income and minority students who took the SAT (39% of test-takers were minority students). According to the College Board, white students score higher on the SAT than black and hispanic students do.

Read the full release.

Top Study Abroad Destinations for U.S. Students

Top 5 Study Abroad Destinations of U.S. Students
Britain 32,071
Italy 24,858
Spain 20,806
France 15,374
Australia 10,813

Fastest-Growing Destinations
Argentina +53.1%
India +52.7%
China +34.9%
Brazil +28.3%
Czech Republic +19.4%
(Source: Institute of International Education)

Learn more about study abroad opportunities!

Black Men Who Graduate From Black Colleges Earn More

A study conducted by Jill M. Constantine, Assistant Professor of Economics at Williams College, revealed that Black men who graduated from historically black colleges and universities (HBCUs) earned more than Black men who graduated from other four-year colleges and universities.

The study entitled "The Effect of Attending Historically Black Colleges and Universities on Future Wages of Black Students" used data from the National Longitudinal Survey of the Class of 1972 to estimate the effect of attending historically black colleges and universities (HBCUs) on future wages of black students.

Constantine found that although the pre-college characteristics of students who attended HBCUs predicted lower wages than did the pre-college characteristics of students who attended mixed or historically white four-year institutions, the value added in future wages from attending HBCUs was 38% higher than that from attending traditionally white or mixed institutions for the average black student graduating from high school in 1972.

Constantine argues that this is evidence that HBCUs played an important role in the labor market success of black students in the 1970s, the author argues, should be carefully weighed in decisions affecting the future of these institutions.

In a new study entitled "The Earnings Impact of Historically Black Colleges and Universities" by researchers at Virginia Tech shows that Black males have no initial advantage from HBCU attendance but that their wages increase 1.4 percent to 1.6 percent faster per year after attending HBCUs compared to Black males who attended other colleges and universities.

This study used data from a series of surveys that examined the financial and life situations of men and women from 1979 to 2004.

In addition to their findings about the benefits to Black male graduates of HBCUs, they found that no similar benefits appear to accrue to Black women. And, that much of the benefits may be due to the social networks they were able to build while attending HBCUs.

Both studies are incredibly significant at a time when affirmative action in college admissions is under attack, the Federal government is promising extensive changes to student financial aid, and college attendance rates for Black men is at an all-time low.

Apply to 34 HBCUs with a single application.

Student Loan Reforms on the Way

mTwo bills, one in the House and one in the Senate, will deliver student loan reforms not seen in over 60 years. This is great news given that the average U.S. college grad leaves college with $19,200 in debt. Many students struggle to pay down their college debt, which usually comes due within 6 months of graduation. This struggle is exacerbated when students pursue careers in public service or teaching, careers that traditionally pay lower salaries. Even students that accept jobs in higher-paying career fields can find themselves unable to manage student loan payments, rent on new apartments and, oh yeah, food.

Both the House and the Senate's bills will provide some much-needed relief to current and future college students, and families considering the amount of debt their students' may have to carry in order to attend their first-choice schools. Though, the House bill, the 2007 College Cost Reduction Act, may be the most beneficial to the most students.

The House Bill

The 2007 College Cost Reduction Act, will benefit students in 6 important ways:

• More Money - More students eligible for federal loans, both subsidized and unsubsidized

• Lower Interest Rates - Interest rates on federal loans and federally subsidized loans will be cut in half in the next five years, from 6.8% to 3.4% on a Subsidized Stafford Loan.

• More Money for Food - The act would limit monthly loan payments to 15 percent of a graduate's discretionary income.

• Pell Grants Increased - Currently, the Pell Grant, a government grants awarded to the nation's neediest students, maxes out at $4,050. By 2011, the Pell Grant would max out at $5,200. The bill would also increase eligibility to about 600,000 more students.
  

• Tuition assistance - Undergraduates and graduate students who plan to teach in public schools would be able to get an extra $4,000 a year, in addition to their loans and other federal grants.
  

• Loan forgiveness (erasing the debt)- Students who pursue careers in public service, i.e. nursing, fire and police, public defenders, will have about $5,000 of their debt forgiven. Other public sector jobs may qualify students for debt for loan forgiveness after 10 years of working in the career field (and paying on the loan).

The Senate Bill

The Senate bill, which was sponsored by Ted Kennedy (D-MA), would raise the Pell Grant an extra $200 by 2012 to $5,400, and cap the amount grads pay each month to 15% of their discretionary income. But, the Senate bill does not include two very big benefits offered by the House bill--the interest-rate reduction on federal loans and the tuition assistance for public school teachers.

Both bills would slash subsidies to lenders to pay for the changes, which represent an additional $18 billion. Not surprisingly, groups representing private lenders (banks, loan companies, finance companies) are lobbying against passage of both bills because their constituents stand to lose millions in subsidies. They argue that the bills would reduce the discounts they are currently able to offer borrowers, and decrease competition leading to fewer options for students who really need assistance paying for college.

In a statement released by the Office of Management and Budget, President Bush's senior advisers have said they will recommend that the president veto the bill because they are an inefficient way to encourage graduates to go into certain professions, and because they"fail to target the neediest students currently in college and creates new mandatory federal programs that are poorly designed and would have significant long-term costs to the taxpayer."

Student groups are, of course, in favor of the reforms, especially the House bill, because it hits home by taking care of all of the ills of the current student aid system.