Last March, President Barack Obama made an appearance at Northern Virginia Community College. According to some of the media, the Chief Executive was there to publicly celebrate the passing of a major part of his health bill.
Yet this portion didn't revolve around the controversial battle for insurance reform. Actually, it had everything to do with how students will get large chunks of their financial aid, everything from scholarships to loans to online college grants.
If you were to ask the general public what was the actual title of the bill Obama signed, don't be surprised if you get a blank stare. It's actually called "The Health Care and Education Reconciliation Act". Most media pundits grossly ignored the second half of that title. What's important is if it goes as planned it could have a very big impact on education, including online colleges.
Admittedly, a considerable amount of the bill has to do with elementary and secondary schools. Yet it is hard to deny the current American education system must be reformed from the ground up. You can't have students ready for graduate and post-graduate work if they can't read when they graduate high school.
Probably the most important part of this education reform revolves around student loans. When the loans were initially created by then President Lyndon Johnson in 1965, students got the money directly from the federal government, which also administered them.
After a time, though, it was felt costs could be saved if the money was administered through banks. Over time, the banks felt they could charge higher rates than was initially planned. As the interest rates escalated, so did the number of loans that began to default. This was then coupled with the present day recession, and the government began to really lose money.
By cutting out the banking middlemen, again returning the student loan system to the federal government, President Obama expects there will less defaults due to lowered interest rates. In addition, the profits generated from these loans can be plowed back into increasing the Pell grant and related financial aid programs. The Pell might actually jump from a $5,350 to a $6,000 ceiling in about one year.
That isn't all the President will do with the savings, either. He announced a portion of money saved will go to online and community colleges. This is because these schools simply cost as much as 60% less than the bigger universities. If the community college has an online division, that's even better. All the school has to prove is it is an accredited Title IV institution.
"For a long time, our student loan system has worked for banks and financial institutions," Obama said that day. "Today, we're finally making our student loan system work for students and our families...we can rightly say the foundation on which America's future will be built is stronger than it was one year ago."
As the rules for lending, as well as scholarships and grants, are changing, all avenues should be explored. Find out what is available with online college grants and see if corporate sponsorship, private grants, or other means are compatible with your needs. Don't overlook government grants, such as the Pell, a backbone of financial aid for those who qualify.
- Article Word Count: 475
- |
- Total Views: 25
- |
- permalink