Financial Aid Requests Rise at Universities

In pleading letters and teary personal visits, more college students across the country are requesting financial aid--or seeking more of it--because of unemployment and other economic woes in their families.

With tuition bills due this month for the coming academic term, authorities are hearing more pleas than ever from middle- and upper-middle-class students, who form the backbone of most college and university enrollments.

“We saw a noticeably higher number of students who came in over the Christmas holidays saying they were going to have trouble this time,” said UCLA financial aid director Lawrence Burt. “Their parents either lost their job or are about to, or didn’t get the bonus or overtime they were counting on.”

Nationwide, similar pleas are being heard at such diverse schools as Harvard University in Massachusetts, Purdue University in Indiana, Colorado State University, Johns Hopkins University in Maryland, Stanford University and Loyola Marymount University.

“We’ve been having large numbers of people experience severe economic dislocations in the middle of the (academic) year,” said Harvard undergraduate financial aid director Jason Miller, who has noticed a rising number of appeals from students whose parents used to have careers as engineers, computer experts, financial analysts, realtors and building contractors, among others.

Wealthy institutions such as Harvard, Caltech or Pomona College can afford to increase outright grants at midyear. But, as a result of responding to the unusual midyear appeals, some schools--particularly public institutions--report that available funds for scholarships and work-study jobs are depleting fast or have run out.

Often, midyear applicants for help are being offered only federally guaranteed loans that must be repaid, although not until months after graduation.

About 1,500 Colorado State students--25% more than last year--have appealed for increases in the financial aid they were awarded last fall for the full year, said aid director G. Kay Jacks. Federally financed Pell grants, between $200 and $2,400 a year, still can be given to the very needy, generally those whose family income is below $25,000.

But in most other cases, Jacks said, additional loans are the only answer because the 21,000-student university has allocated all its own grant money.

“That is one of the frustrations,” she said. “You really empathize with the families.”

Loyola Marymount bursar Raymond Dennis reports about a 15% increase this semester over last in the number of students requesting a monthly payment plan for tuition. He speculated that one reason for the rise, in addition to unemployment, is that some companies have eliminated previously generous reimbursements for employees’ tuition.

At UCLA, the number of undergraduates receiving need-based financial aid has risen about 13% over the past year, from 8,595 to 9,744, out of a total 24,000 undergraduates. Financial aid director Burt attributes some of that increase to the 40% fee rise this year that caused more families to become eligible for the assistance. UC officials anticipate that more will qualify next year when fees rise another 24%.

In a sign of the times, more UCLA students are accepting campus cafeteria jobs that were spurned in the past as too grungy, school officials report. Also, most students in the work-study program--which enables students to earn money if they take a campus job--are choosing to work the maximum hours allowed. As a result, UCLA has begun limiting its work-study awards to $2,400 per student this year, while in the past it could award up to twice that amount.

A new study by UCLA’s Higher Education Research Institute found that students increasingly are deciding where to apply for college on the basis of cost and the availability of financial aid. The study found that 27.7% of 1991 freshmen nationwide chose colleges based on low tuition, compared with 23.4% in 1990 and 17.7% in 1981. Offers of financial aid lured 27.8% of current freshmen, up from 25.2% the previous year and 15.4% a decade ago.

In the best of years, applying for financial aid can be a complicated and draining experience. Add unemployment, bankruptcies and tuition hikes caused by state budget problems, and the result has been hard on all involved.

“I think kids feel an enormous sense of responsibility in asking their parents to pay for education--particularly high-cost education--when the family is having financial problems,” said Harvard’s Miller.

Gwendolyn Neal, UCLA’s associate director of financial aid, agreed. “The students are often in tears because of their personal problems,” she said, recalling recent counseling sessions. One student receiving substantial aid pleaded for more because business at her family’s San Fernando Valley liquor store has sharply declined. The student was offered more loans.

At Occidental College, sophomore Nancy Yao became extremely worried about paying her steep tuition bill last month when her father lost his accounting job at Pan American Airlines, which went out of business Dec. 4. As a result, the New York City family lost the free flight privileges that Yao depended on to travel west to school. Her mother’s real estate business was in the dumps, too.

“The effect of the recession on our family has been massive,” Yao said recently. Yao got a part-time job, working 20 hours a week as a secretary in a Los Angeles-area law firm. She also appealed to Occidental for more aid. Last week, after an anxious waiting period, Yao learned that the college will boost her scholarship from $3,100 to $11,340 and reduce her loans from college and government programs from $10,625 to $6,625. As a result, about $18,000 of her $21,000 annual school and living expenses will be covered through grants and loans. Yao said she can stop worrying about possibly having to leave school.

Occidental financial aid director Youlonda Copeland-Morgan warned that not all appeals may have such happy endings. Occidental grants awarded this school year have exceeded by $100,000 the $7.53 million budgeted--and more money requests from students hurt by the recession are expected when the spring term begins in March.

“We hope the funds will be sufficient. But we’re not certain of that,” Copeland-Morgan said.

Despite such limits, schools are continuing to urge students with new financial troubles to come forward.

At Caltech, financial aid director David Levy told of a sophomore who was in deep money trouble after his technician father and beautician mother both lost their jobs last summer. Based on the family’s previous report of $40,000 combined income, the student had been awarded $11,000 in grants and loans toward the $14,100 tuition and fees, not including room and board. After an appeal, Levy said, the aid was increased to $16,000.

“We are making adjustments,” Levy said. “We will do whatever it takes to keep them in school.”

Nonetheless, educators are concerned that some students whose families have suffered a severe drop in income may become so discouraged that they will drop out--if only temporarily.

Although no statistics are available, anecdotal reports indicate that more college students are “stopping out” for a semester or so to work and save money for next year’s schooling, according to the National Assn. of Student Financial Aid Administrators, a group based in Washington.

Meanwhile, loan programs are showing more signs of strain, officials say. Defaults and requests for payment delays are said to be increasing as borrowers who have graduated face unemployment.

Some of the unemployed may not know that they can apply for a 24-month delay in payments, said John Dean, special counsel to the Consumer Bankers Assn.

“With collection notices from credit cards and car loans also coming,” Dean said, “those people are so discouraged that they are not in the mood to talk to anyone from a financial institution.”