Student aid group urging college-bound kids to pump the brakes on student loans

Paul Kurtz
November 01, 2019 - 4:21 pm
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PHILADELPHIA (KYW Newsradio) — It's no secret that college costs have skyrocketed, but the debt bubble is growing so rapidly that a leading student aid organization is now sending out a nationwide warning to high school juniors and seniors.

The Pennsylvania Higher Education Assistance Agency is telling college-bound students to pump the brakes on those loans after getting the latest statistics that 4 million borrowers in this country are carrying upwards of $1.5 trillion in student loans. 

More than a million of those people have debts of $100,000 or more.    

Ron Feldman is a veteran PHEAA adviser who works on the ground level and has become almost preacher-like in urging kids to avoid student loans as a first option.  

"Prior to even getting these bills, how about you reduce the amount the bill is by applying for scholarships, grants, knowing the merit aid, institutional aid for the school," he advised. 

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Feldman and other college funding experts say that, too often, students and parents don't look beyond the cost of tuition.  

"It's the tuition, the room and board, the other services that are provided. And it's just overwhelming for families because they really can't see what the true cost of the education is right now and the system has lacked transparency and simplicity," said Peter Sims, president of Pay For Ed in Newtown Square.

Since 1979, Sims says family incomes have increased around 360 percent, while college tuition and fees have gone up more than 1,300 percent. 

The average student loan debt in Pennsylvania is now $38,000, the second highest in the nation due to the large number of private universities in the state and a decrease in state funding for higher education.  

Sims says the overall transfer rate has risen to around 35 percent. 

"One of the main reasons is the inability to pay for their tuition in year two or three. So they find a cheaper school," he explained.