U.S. Senators Tom Harkin (D-Iowa) and Al Franken (D-Minn.) introduced bipartisan-sponsored legislation May 24 that aims to help students and families understand how much they could spend on a college education, how costs may vary by school, and what practices they should undertake, prior to enrollment.
Harkin’s office announced today that the “Understanding the True Cost of College Act” would create a universal financial aid award letter to all students that would easily compare financial aid packages at various schools. The letter would, according to the news release issued by Harkin’s office, standardize the language used in defining and describing aid from different schools, and would clarify the differences in types of aid.
The act would require colleges to use a uniform financial aid letter; would require the U.S. Department of Education to work with colleges, consumer groups, and others to develop standard language for financial aid terms; establish a basic amount of information that must be included in the uniform letter, including cost of attendance, grant aid, loan details, and expected loan repayment amounts; and require the department to consumer-test the uniform financial aid letter.
Should the act pass, it could be one of several ways the federal government is trying to clarify the process of student loans and potentially reduce student debt. The Consumer Financial Protection Bureau launched a comparison tool in April designed to provide students with a means to examine costs and aid options at multiple schools, and show them how long it could take to pay loans back.
Harkin has been very active in the higher education realm lately, proposing a bill in April that would keep federal student aid dollars from being used for marketing and recruiting, and issuing a “Debt Without a Diploma” report in 2010 leading to regulations from which for-profit colleges especially are feeling the sting.
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