The College Planning Blog

In the past few months, largely in response to the credit crunch precipitated by the subprime mortgage crisis, some homeowners have been receiving letters from their lenders indicating that their home equity lines of credit have been frozen. In some cases, these freezes may be the result of missed payments (even missed payments on other debts) or declining home values in the area, but that’s not always the case. Many freezes are happening to homeowners with homes that have not declined in value, and who have impeccable payment histories and credit records. (more…)

According to this article at the Seattle Business Journal WaMu is shutting down or reducing customers lines’ of credit. Bad news if you were planning to use a HELOC to pay college expenses.

WaMu reduces home equity credit to homeowners

This is not completely unexpected, but for many may be unwelcome.

Hi everyone, Brannon here.

Some interesting changes are coming to Federal Aid due to the current student loan Crisis. The federal government is trying to open things up for families. But keep in mind their answer is offering more debt.

To accomplish this, the Act grants the Secretary of Education temporary authority to purchase loans from lenders in the federally guaranteed loan program (officially called the Federal Family Education Loan Program) if the Secretary determines that lenders can’t meet the demand for student loans. The Act also authorizes the Secretary of Education to advance federal funds to guarantee agencies that are operating as “lenders of last resort” in the event they don’t have sufficient capital to originate new loans. The Act also dispenses with the requirement that students demonstrate an inability to borrow from other sources before turning to a lender of last resort.
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Yes. Yes I am.

Crazy enough to know what the heck I am talking about.

A parent asked me the above question recently and at the time i laughed, but later, as i thought about it more i realized he wasn’t trying to be difficult or unfair, he was unaware of how times have changed.

Since most of today’s parents’ applied for college 20+ years ago the world has changed dramatically when it comes to applying to college. Most of them applied to one, two or maybe three colleges and if they appled to three, their friends made fun of them.

Things are different now. We stand at what is the crest of the largest wave of new students planning to attend college in history and students need options. Six to eight schools is not that unreasonable when you break it down:

1. 2-3 ‘aspirational’ schools
2. 3-4 Schools that represent good, solid choices your child has a good chance of getting into
3. 1-2 Safety schools. In short these should be a slam dunk on getting in.

Which brings me to real reason to apply to multiple schools even if your kid is SURE they want to go to school X.

Money. Money plain and simple. I’ve seen$10-15k gaps between the best and worst school for the exact same family. I will go into why in a later post, but the short version is that some schools will offer you more and others will likely offer you less regardless of how much you make. The amount depends on the student, your financial situation and the school and their policies.

Parents, just trust me-times have changed and go with this recommendation.

Ok, I am about to rant, but I can’t help it. Everywhere i look Time Magazine, US News, The Wall Street Journal and New York Times ALL get it wrong, and I am going to tell you how to get it right.

Quick, how much does a year at college cost? I suppose your answer should depend on the college in question, but if you are any of the magazines or newspapers just mentioned you routinely get this information WRONG, and its making me crazy.

They often post the cost of Tuition and sometimes the cost of tuition and room and board. As a result they give you either 1/3 or maybe 2/3’s of the total cost. But the first rule of affordability is, what does it cost. The term you will have to get used to asking for on your college visits is something called “Cost of Attendance”. All colleges can answer this for you, but surprisingly (or not) many times when i have called them it sounds like the person on the other end of the phone is trying to find all of the information in order to add it up and tell me.

So what does it cost on average?

Here in Texas a state school runs $18-$22,000 and Private schools anywhere can run from $30-$55,000. Do yourself a favor and ASK. How can you expect to pay for anything if you don’t know the cost?

So is this the result of some conspiracy between the schools and media to misrepresent the total cost? I doubt it, but most writers rely on the schools for the answer and don’t question (or research) it. Again, PLEASE ask your schools about the COST OF ATTENDANCE. Knowing the real and actual cost is just smart. Will you get aid? I have no idea, since i don’t know you. But the smart way to plan is to assume you will get none, be ready for that, and sometimes be pleasantly surprised. Don’t ASSUME you will get money and plan for that-Murphy is alive and well.

Hey Guys,

I ran across this article in the Austin Statesman. Most people assume great scores is all you need to get into a great school. Unfortunately, much more is involved and that’s what we are here for.

We have the experience and know what it takes to get your student in.

Here’s the article:

Perfect college entrance exam scores don’t help student who dreamt of the Ivy Leagues
Despite perfect scores on the SAT and ACT, a LBJ Liberal Arts Academy student failed to make it into his dream schools.

By Laura Heinauer
AMERICAN-STATESMAN STAFF
Saturday, April 19, 2008

Things were going, well, perfectly for Navonil Ghosh up until several weeks ago.

The college-bound LBJ High School Liberal Arts and Science Academy senior racked up more than 400 hours volunteering in local hospitals and libraries. He plays the piano, is a first-degree black belt in Kung Fu and got a perfect score on both the SAT and ACT college entrance exams. Ghosh had mailed out all of his college applications and was just waiting for the acceptance letters to come pouring in.

But the letters that began filling his mailbox were of a different kind.

The first rejection came from Stanford University in California, but the hits kept coming. From the Massachusetts Institute of Technology. From Ivy League institutions: University of Pennsylvania, Princeton and Yale, where he was wait-listed. But the biggest disappointment came from Harvard University, which Ghosh had chosen as his “dream school” based on the course offerings. Even the Plan II honors program at the University of Texas turned him down.

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Where do we start this week? How about this headline?

What is surprising about it? I’m just surprised that this is the first example of someone robbing a bank to pay for college.

It is tragic that these young men will now be spending the next 20 years of their life in prison.

This is a fair warning. If you have a student that is currently a junior, and you have yet to come in for an appointment, you have just a couple of weeks to get in for an initial consultation. Remember that APPLICATIONS will begin this September. Call 281 822 6200 immediately for an appointment. Otherwise, you will never know how we could have helped you with your situation.

So, on with the story… (more…)

College Essays 101

Admissions Experts Offer Five Tips on Writing College Application Essays

By ELLEN GAMERMAN
November 29, 2007 9:47 p.m.

1. Don’t name the college in your essay. Brown’s dean of admission, Jim Miller, says every year his office gets about a dozen essays in which the student has forgotten to swap out the name of the school for Brown. “We understand it happens, but still, it’s not putting your best foot forward when you say, ‘And that’s why Stanford has always been my first choice.”
2. Don’t rely on spell-check. Jennifer Ruddy Simpson, director of college advising at Kent Place School in Summit, N.J., used to work in the college-admissions office at Columbia University. She remembers one applicant getting a very important word wrong. “A student actually misspelled Columbia,” she says. In the essay, the school was spelled like the country: Colombia. The student didn’t get in. (more…)

Hey,

I’m finally starting to get caught up from my busy season, so be sure to give me a shout if you need anything. The article is below. Also, feel free to pass it along to anyone who would enjoy it.

Jeff, Jeremy and Brannon

7 Tips to Make the Most of Your College Visits

If you are even thinking about going to college in the next few years, visiting your potential colleges is one of the most important steps that you can take. Just like you wouldn’t buy a car without going for a test drive, you would be amazed at what you can learn about a school in just a few hours. So, to help you get started, here are some tips to make the most of your visits:

1. Start by visiting one type of each college you are considering. For instance, if you are not sure whether you would like a smaller or larger college, visit a couple of schools that are close by that represent each type, like a large public school and then a smaller private school. At least now, you’ll have something to compare.
2. Do your homework before you go, and narrow your choices by using a good school selection program. You can find some good ones online or contact my office at the address below for our suggestions. Also, make sure that the schools you are considering actually have the major you are interested in. I know it sounds obvious, but you’d be surprised at how often people skip this step. (more…)

Sallie boss warns of student loan ‘train wreck’

House OKs measure to get more money to struggling lender

The Associated Press

updated 6:14 p.m. CT, Thurs., April. 17, 2008

WASHINGTON - Sallie Mae says it cannot write money-losing student loans indefinitely.

Top executives are holding “daily deliberations” about just how long the nation’s largest student lender can afford to sacrifice its bottom line for the sake of college-bound Americans, Sallie Mae CEO Albert J. Lord said Thursday.

Lord told analysts on an earlier conference call: “We’ve been predicting something of a train wreck” in mid-2008 without prompt changes in a market hit by fallout from the subprime mortgage crisis and cuts last year in federal subsidies to student lenders.

Experts said that, unless the government intervenes or market conditions rapidly improve, Sallie Mae could have no choice but to stop writing new federally backed loans. (more…)