Online Shopping Tool Compares College Costs
Published: Thursday, April 26, 2012
Updated: Wednesday, April 25, 2012 19:04
Amidst growing concern about student debt education, the Consumer Financial Protection Bureau (CFPB) has released an online comparison tool for prospective college students. The cost comparison worksheet allows students to gauge their expected post-graduate debt and plan accordingly.
The CFBP was established by Congress in 2011 in order to regulate consumer protection in the United States. According to its Web site, the bureau’s main goal is “ensuring that consumers get the information they need ... that prices are clear up front, that risks are visible, and that nothing is buried in fine print.”
In addition to providing clear explanations of laws, rights and resources for consumers who already have debt, the CFBP’s Website also provides “Know Before You Know” resources for gaining information on credit cards, mortgages and student loans.
The new college cost worksheet allows students to compare up to three colleges at once. When three schools are picked, the site shows average first year costs, with no financial aid taken into account.
Students are then able to enter in their financial aid in the form of grants, scholarships, work study, loans and the amount they and their families can contribute. The tool compares your chosen colleges with averages for private four-year colleges and public four-year institutions.
Aside from allowing students to compare financial aid offers, the Web site also puts student debt into perspective. Once the amount being borrowed is determined, it ranks the debt burden as low, medium or heavy, again comparing the costs with the national average. Based on that figure, it shows the approximate amount you will have to pay each month for 10 years to cover the total borrowing, based on the standard 10-year repayment plan.
In addition to giving the blanket amount, the site compares the price to buying $50 textbooks for a month. For a student whose expected payment rate is $1,327 per month, for example, it is equivalent to buying 27 $50 textbooks each month for 10 years.
The tool was born out of the desire to regulate financial aid offers and make them easy to understand for students and their families. “We’ve heard from students, college counselors, and community organizations that many of these offers don’t always effectively deliver this information,” said the CFBP Web site. The comparison tool, as well as the feedback received from those who use it, helps the CFBP gather information for the Department of Education in order to improve financial aid communications.
“I think this is a great resource,” said Sarah Barstow ’13. “It’s helpful to know exactly what you’re getting into, financially allowing you to prepare for college and all of its costs.”
“I wish I had known about this before,” Barstow continued. “I cannot even imagine what my debt will be and it’s intimidating.”