Students May Seek More Loans as Savings for College Declines, Analysts Say

[marmar]

from Bloomberg:



Students May Seek More Loans as Savings Dwindle (Update2)

By Amy Eagleburger

Nov. 10 (Bloomberg) -- College students may have to borrow more to finance their higher education as market turmoil erodes savings, a public policy group that tracks student aid said.

For the class of 2007, the average debt for a graduating undergraduate student was $20,098, a 6 percent increase over 2006, according to the Project on Student Debt. Declining home values and rising unemployment have led one-third of parents to slow college savings, an August survey by TD Ameritrade Holding Corp. said.

``Their other sources of money have dried up,'' said Robert Shireman, executive director of the Berkeley, California-based Project on Student Debt. ``At worse they have lost their job and a lot of others will see their savings account diminished.''

The Standard and Poor's 500 index has fallen 38 percent year to date. According to financial data firm Morningstar, Inc., all 79 of the so-called 529 college savings plans in its database have fallen in value this year, with 60 dropping more than 10 percent.

In the 2007-2008 academic year, more than $143 billion in financial aid was distributed through federal loans, grants, federal work-study, federal tax credits and deductions, according to the College Board, a New York- based nonprofit association of colleges. An additional $19 billion was borrowed from state and private sources.

Real Challenges

``We have been staying close to the developments in federal student aid and in student lending,'' Sara Martinez Tucker, Under Secretary for the U.S. Department of Education, said in a news conference today. .......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601213&sid=a0Ale6hNnw68&refer=home

[Avalux]

1. Meanwhile, top colleges are scouring China's high schools for students...

...and offering them scholarships to attend. Makes me very angry.

[midnight]

2. Me too.... In September we tried to co-sign for a college loan

for our child and we were told no, and that no other reason was going to be given. Then in October the makes make millions of dollars via the govt., and we stand alone. Now top colleges pouring money out to China's college students. This is just the icing on the cake.

[liberalhistorian]

3. Me, too. My son's a junior

is extremely bright, particularly in science, and he's gonna have to take out loans for college, if he can even get them. Maybe I should send him to China for his senior year.