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(EMAILWIRE.COM, January 29, 2010 ) Miami, FL - The current economic crunch and recent congressional action have caused lending institutions to shrivel up and meet their demise. Which viable options remain for students to get funding for college?
Tuition, room and board costs for the most expensive school in the US averages at $50,000 annually. When it comes to private colleges the same annual bill amounts to an average of $34,000 while for public universities the figure stands at $14,000 – these are no small sums for parents to come up with in a deep rooted recession. Accredited distance learning assumes the same tuition costs for the “brick and mortar” colleges but is a lot cheaper since students leave at home while undertaking on line studies disregarding cost for room and board. And that is just undergraduate studies.
Graduate school presents an even more difficult problem. A graduate degree is more and more important in this economy and it is harder and harder to get financial aid for those programs.
In the recent past, parents defrayed their children’s higher education by securing loans against their assets, for instance, home equity was the most common one but they have greatly been devalued. Reports by various college funding consultancy firms, especially those working with high income families claim that, “Even parents who thought they were fully funded for college are now trying to determine how to fill these gaps.”
Students are left with no other option but to borrow. The congressional action together with the credit crisis has led to the great imbalance in the lending industry over the past two years. Perhaps the biggest blow that hit the lending industry is when Congress froze subsidies to private lenders that issue government-supported loans through the Federal Family Education Loan Program.
The hard blow has seen to it that 45 creditors have stopped issuing private loans and over 160 creditors suspended (temporarily or otherwise indefinitely) their federal loan programs, according to Sheila Danzig, founder of Degree.com, http://www.degree.com, the premier internet portal for online study. She goes on to add that the key provision in the new budget by the Obama administration is bent on ensuring that students borrow from the government directly through their colleges hence eliminating the private organizations which also provide the service.
Borrowers will need to apply wits in securing finance for funding various degree programs. Firstly, they should fill out the FAFSA (Free Application for Federal Student Aid) which opens a doorway to scholarships and grants. Many families complain that the form is too long, complicated and requires providence of sensitive (financial) information. Even if you donÂ’t require the aid now, it is good insurance for the future in an uncertain economy such as this.
Secondly, consider the government-backed Stafford loan even if you donÂ’t qualify for the subsidized version as this one is available to all, irrespective of family income or credit score. It also has a reasonable fixed interest rate of 6.8%.
The third option would be taking the Federal PLUS loan which allows students to borrow up to the full amount of tuition and board. It has minimal credit requirements and payment may be deferred until graduation, however interest would accrue.
The last resorts would be home-equity (even with the devaluation of real-estate) and private loans – as hard as they may be to find and secure.
For a FREE book on Scholarships and Financial Aid go to http://degree.com/free-downloads.htm
This book sells at Amazon for $19.95 so download it now. We do not know how long the free offer will last.
Degree.com
Sheila Danzig
2139737821
sheila@danzig.com 
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