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NYSFAA Conference Oct 2012

Anthony M. SozzoAssociate Dean

Director of Student Financial Planning

National Association of Student Financial Aid Administrators

NASFAA Task Force on Award Letters

Pam Fowler, NASFAA National Chair, University of MichiganJustin Draeger, NASFAA

Ben Burton, Ivy Tech Community College of IndianaNancy Hoover, Denison UniversityMichelle Stipp, DeVry University

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Core ElementsThere are 10 Core Elements

1. Cost of Attendance

2. Scholarship and Grant Awards (Gift Aid)

3. Net costs After Gift Aid

4. Self-Help Options

5. Assumptions

6. Link to Resources of Total Loan Debt (Aggregator) and Calculator for ED or other Third Party

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Core ElementsThere are 10 Core Elements

7. Line to Consumer Information Disclosures

8. Line to a Public Glossary of Standard terms and Definitions

9. Contact Information for the Financial Aid Office

10.Deadlines and Next Steps

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Core ElementsElement #1 Cost of Attendance

“The federally defined Cost of Attendance (COA) should be listed on every award letter or notification to students.”

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Core ElementsElement #1 Cost of Attendance

At a minimum, this costs of attendance should include:

• Expected charges for one year for tuition and mandatory fees

• Room and board (for on-campus residents)• Estimated living expenses (for off-campus

residents)• Estimated transportation costs• Estimated books and supplies costs• Estimated miscellaneous costs

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Core ElementsElement #2 Scholarship and Grant Awards (Gift Aid)

• This element should include gift aid from all sources.

• Award notifications should transparently indicate awards that are gifts as opposed to self-help (work-study or loans) so students can easily calculate their net costs after gift aid.

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Core ElementsElement #3 Net Costs After Gift Aid

• It is essential that students understand what their financial responsibility will be after gift aid is subtracted.

• Optionally, schools should consider displaying how much of the gift aid will cover direct costs in addition to the overall net costs after gift aid.

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Recommendation #2

Components of the cost of attendance should be broken down into two, clearly labeled classifications:

1. Direct Costs

2. Indirect Costs

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Recommendation #2

• Direct Costs:– Tuition and Fees– Room and Board (Based on institutional

situation)– Total Direct Costs

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Recommendation #2

• Indirect Costs:– Books and Supplies– Transportation– Miscellaneous– Total Estimated Indirect Costs– Room and Board (based on institutional

situation)

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• Ivy Tech Award Letter via Word Document

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Student Consumer Information

Students and families need access to key pieces of information to assist in the decision-making process.

– Some of this information is required by the US Department of Education

• All schools should:– Post the information on their website– Provide the same/similar information in the

same/similar format– Link to the information already being reported

• See Appendix B for a complete list

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Student Consumer Information

What should be shared:• General Consumer Information• Net Price • Student Loan Counseling• Indebtedness • Default Rate • Graduation and Retention Rates

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Standardized Award Letter Terminology

• Developed to provide institutions with definitions to common terms used on award notifications– Terms defined by the financial aid community

• Generate understanding by students through consistent use on award notifications at all schools

• Allow prospective students to compare information from multiple schools because terms have common definitions

• Complete Glossary of Terms in Appendix A

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CFPB-- Know Before You Owe—Shopping SheetRequires

• Estimated monthly payment for cumulative federal debt for all years of college attendance

• Estimated monthly payment for cumulative private loan debt for all years of college attendance

• Total estimated cumulative debt for student for all years of college attendance

• Estimated monthly payment for cumulative debt from different types of loans for all years of college attendance

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NASFAA– Award Notification and Consumer Information Task Force Report

Agrees• Students should be informed of the potential cumulative debt they may

incur before enrolling in a college• Students should be informed, through standardized terminology, about

the different terms and loans available to them to pay college costs

Recommends • Schools should provide students on the award notification their

cumulative loan history (federal and private)• Schools should provide students with a standardized calculator,

developed by the Department of Education, so students can accurately calculate repayment estimates before they borrow additional loans

• There needs to be a comprehensive loan database of all educational loans (federal and private) so students can have access to their entire cumulative debt

• The Department of Education should mandate that all educational loans (federal, private, and institutional) be reported to one central database

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Financial Awareness Counselingstudentloans.gov

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Financial Awareness Counselingstudentloans.gov

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Financial Awareness Counselingstudentloans.gov

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