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(EMAILWIRE.COM, January 07, 2010 ) Washington DC
The cost of college tuition and room & board has grown by 121 percent since 1980. Median household income increased 18 percent during the same period. Much of the difference between these two percentages was met by student loans.
Acquiring a college degree will soon be likened to rocket science as it is becoming more and more difficult to enroll and remain in college until graduation; considering the ever soaring college costs in a time such as this of global recession and the difficulty in securing student loans.
The Credit Card Accountability, Responsibility and Disclosure Act (or Credit CARD Act) of 2009 set to take effect on Feb 22nd, 2010, only ‘worsens’ the situation for college students. The Act bans credit cards for people under the age of 21 unless an adult accompanies them to the particular credit card company and co-signs the contract. Another route minors could use to acquire a credit card would be by showing proof that they will be able to repay the debts with minimal difficulty. It is evident that college students termed to be ‘the lowest earners BUT highest spenders’, will inadvertently have to cut costs on campus – and off for that matter.
According to Sheila Danzig, founder of Degree.com, http://www.degree.com, the premier internet portal for online study, student loans are difficult to secure for a number of reasons. She attributes the difficulty currently due to the upheaval in the financial markets caused by the recession making private lenders stingier when it comes to granting of such loans. Another discouraging factor might be the increased interest rates which greatly discourage students from applying for the loans since they donÂ’t want to graduate with a BS in Information Technology for instance, and service the loan for the better part of their remaining lives.
At least ten years ago parents could count on easily securing student loans against the value of their houses but that isnÂ’t a viable option anymore considering that home-equity value has dropped by over 25 percent in the past two years.
Research has it that, since 1980 the cost of college tuition and on-campus living expenses has grown by over 121 percent while household income has increased by only 18 percent in the same period of time. Over the years, student loans have been used to bridge the gap between the two percentages. The question in the minds of many remains, how can the gap be bridged once again with student loans being so difficult to obtain? Students have decided to give distance learning a try since it saves greatly on room and board as they can operate from home.
Securing a college loan is becoming more difficult and ironically tuition costs continue to rocket. This puts college out of reach for those who cannot afford but have the zeal for enrolling into various degree programs.
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