Financial aid offers from 9 in 10 U.S. colleges are misleading: report – By Aimee Picchi (Moneywatch) / Dec 6, 2022
Although the soaring cost of a bachelor’s degree in the U.S. is often blamed for students racking up a record $1.6 trillion in debt, the problem may begin even before someone enrolls in college. The reason: Nine in 10 schools fail to provide Americans with an accurate estimate of the cost of attendance in their financial aid offers, according to a new government report.
That failure makes it difficult for students to compare competing financial aid offers, and could cause them to underestimate their actual costs. That can lead them to take on more debt than they initially expected, cut back on essential expenses like food to stay afloat or even abandon their education, according to the U.S. Government Accountability Office, a watchdog agency.
Murky sticky prices
The analysis of financial aid offers from 176 colleges around the country underscores the lack of oversight for what is often one of the biggest financial decisions in a person’s life. Unlike other financial products — mortgages, auto loans and the like — there are no federal laws that mandate disclosures that colleges must make to students and their families when providing financial aid offers.
As a result, colleges frequently omit costs, underestimate expenses and even describe student loans as “awards.”
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