consumer disclosure proposals

Consumer Disclosure Proposals

Presented by the National Association of Student Financial Aid Administrators

Current Consumer Disclosure Climate

• Major focus in Washington on consumer disclosure for students & families

• Numerous proposals regarding award letters and consumer disclosures

• Proposals contain overlaps in goals, mandates, and public outreach

Recent Proposals

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College Scorecard

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Shopping Sheet

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Shopping Sheet Details

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• NASFAA has been in constant communication with ED, White House & CFPB on the issue

• NASFAA appreciates that the Shopping Sheet is voluntary, but remains concerned about the inflexible nature:– One size fits all for every sector and type of student

– Does not allow for information to tailor information to the unique needs of their students

– Comparative information has potential to be inaccurate and misleading

Shopping Sheet- Next Steps

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• As of end of September, 316 institutions had officially “signed on”—though many had done so de facto through their commitment to the VA Principles of Excellence

• NASFAA remains in discussions with key stakeholders related to how the sheet can be improved

• NASFAA Consumer Testing of Award Letters

Comparison Worksheet

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Senator Franken’s Award Letter Standardization Bill

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Senator Blumenthal’s Consumer Disclosure Bill

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Federal Model Award Offer Forum

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Principles of Excellence (Shopping Sheet Provision)

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Recommendations from NASFAA Award Letter Task Force

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NASFA Award Letter Task Force Recommendations

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1. Include 10 core elements:– Cost of Attendance

– Scholarship & Grant Awards

– Net Costs After Gift Aid

– Self-Help Options

– Assumptions (enrollment status; housing, etc.)

– Link to Total Debt Aggregator

– Link to Consumer Information Disclosures

– Link to Glossary of Terms and Definitions

– Contact Information for the Financial Aid Office

– Deadlines and Next Steps

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2. Components of COA should be broken down into:

– Direct Costs

– Indirect Costs

3. Students should be informed of the potential debt they may incur at a college before paying the enrollment deposit

4. Award notifications should provide enrolled students with their cumulative loan history

NASFA Award Letter Task Force Recommendations

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NASFA Award Letter Task Force Recommendations

5. The U.S. Department of Education should mandate that there be a central loan database (aggregator) where students can see all—federal and private—loans.

6. Each award letter should link to school-created web resource that contains links to additional information

Where to go from here?

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• With so many proposals addressing the same issues and large amounts of redundancy:– Create a dialogue to combine/analyze the

numerous options– Conduct actual consumer testing so that

measures of usability and comprehension are a part of discussions

– Focus attention on the need to eliminate and/or streamline existing efforts before introducing new