Daughter got accepted, not sure I can afford it

Parents Forum
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<p>Re post #217 – there is nothing that explains in that document how Reed considers home equity. Do they take the full equity of the home? They seem to think that parents with equity can easily “tap into” it by borrowing? Do they understand that banks generally require income qualification for lending? – that a low income person living in a home with high equity, perhaps because they have lived in a modest home for long enough to have paid it off and for its value to appreciate well beyond what they paid for it – probably wouldn’t qualify to “tap” into the money and wouldn’t be able to afford the loan payments even if they could? </p>

<p>Reed claims to meet 100% need of its students. Why does its [2010</a> common data set](<a href=“http://web.reed.edu/ir/cds/cds1011/cdssech201011.html]2010”>Reed College 2010-11 Common Data Set SecH - Institutional Research - Reed College) report that 757 student were found to have need, but only 747 had their need fully met? What happened to those other 10 students? Why in [url=&lt;a href=“http://web.reed.edu/ir/cds/cds0910/cdssech200910.html]2009[/url”&gt;Reed College 2009-10 Common Data Set SecH - Institutional Research - Reed College]2009[/url</a>] did Reed fail to meet the need of 6 out of 183 incoming students found to have need, and 15 students overall? What about the 32 students left off the financial aid train in [url=&lt;a href=“http://web.reed.edu/ir/cds/cds0809/cdssech200809.html]2008[/url”&gt;Reed College 2008-09 Common Data Set SecH - Institutional Research - Reed College]2008[/url</a>], or the 77 dropped from financial aid in [url=&lt;a href=“http://www.reed.edu/ir/cds/cds0708/cdssech200708.html]2007[/url”&gt;Reed College 2007-08 Common Data Set SecH - Institutional Research - Reed College]2007[/url</a>]?</p>

<p>The document you posted is informational, but it is not “transparency”. It puts out the information the college wants to put out – but it doesn’t lay out any formulas, enable the parents to calculate their own awards – and, like other marketing information, it doesn’t tell the whole story. </p>

<p>I think the reason that we don’t see eye to eye is that with my legal background, I was trained to ask all these questions, to look at the biases and motivations of people or agencies making statements, to seek out the documentation behind the statements, to do the basic math. Obviously I was often in a position of representing clients who had been misled at some point in a transaction by claims made by the other party. </p>

<p>What I see in college application process, particularly among private colleges, is a lot of marketing hype. Obviously there are those here who accept the hype at face value. If things work out for you, then there is no reason to ever question what you were told. The people putting out the hype are able to get away with it because most of the time it works. Analogy: if an auto manufacturer knows that there is a defect in their cars that occasionally causes brakes to fail in 2% of the cars they sell, they can go a long time without fixing or disclosing that fact – because 98% of the time, the car buyers have no problem. As to the other 2% – there’s a high likelihood that when the brakes fail in their car, they will attribute it to other factors than the underlying defect.</p>

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<p>Don’t flush down 30-50k a year for something as worthless as a history degree. Don’t get me wrong, it’s a lot of fun (I did sign up to be a history major a few years ago), but it’s worthless unless you want to teach. And in that case, it’s even more stupid to dump money on a relatively low-paying future. Erase that dream school as a possibility.</p>

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<p>Re: calmom’s post #220 - Very interesting interpretation. I agree that children of divorce usually get screwed over by the FA system, but I don’t think that is necessarily tied to race. Especially among top schools–the ones where an increase in need would actually lead to an increase in grant money–the institution is actively recruiting URMs. It would seem counterproductive to place financial discrimination as a barrier in front of their own freely declared goal.</p>

<p>I don’t know if there’s a fair solution to the noncustodial parent issue, because I think that FAFSA’s ignore-them approach is also flawed, encouraging sham divorces and benefiting families with a wealthy NCP who IS willing to contribute. Perhaps the best compromise is a policy of not being so stingy with NCP waivers, thus relying on professional judgment for parity.</p>

<p>Re: post 221 - According to Swarthmore’s response to a student FA petition a few years ago (linked above), the FA office applies a lowest-best multiple-formula approach to home equity. For example, the formula that caps home equity to equal income would account for low-income/high-equity situations.</p>

<p>Reed’s unmet-need numbers are much lower than Lafayette’s, and could plausibly be explained by students failing to meet FA paperwork deadlines (though 77 in 2007 is rather high).</p>

<p>I think colleges are wary of revealing their formulas completely, to the point where independent calculations can be made, for two (not completely malicious) reasons:</p>

<p>1) With the advent of preferential packaging, they don’t want to get into an overt price war with competitors. While such a situation would obviously benefit the consumer, the college has no legal or moral obligation to reveal its practices–for private institutions, anyway.</p>

<p>2) Professional judgment can go both ways. It most often “hurts” self-employed families when tax deductions are added back in as income. Since the college is the final arbiter of how it spends its money, revealing its FA formula entirely (even if no preferential packaging is practiced) would probably lead to more angry parents wanting to know why their numbers don’t match up with the college’s numbers. This leads to more time spent on paperwork and appeals without a change in actual practice, since again, the college is the final arbiter.</p>

<p>I will note that some colleges–often the less selective LACs–will offer an FA “pre-read” for ED hopefuls.</p>

<p>Calmom, I would like to ask you an honest question: What is inherently wrong with marketing hype? As you know, I and others disagree with you on what points of college advertising and statements are “hype,” what is truth and half-truth and half-lie and outright lie (the middle two being moral judgments more often than not). But colleges are institutions–businesses, many would say–that have the right to advertise. To a point, all advertising is false hype.</p>

<p>I am a student and have very little legitimate “background” to speak of, so I make no claims from authority. But with your legal background, I am surprised that you would claim colleges (most colleges, beyond a few suspicious exceptions) are “lying” when they say they meet full need. From a layperson’s standpoint, I have faith (misplaced? you tell me) that if all these–wealthy–colleges were “lying” in the eyes of the law, there would have been a high-profile lawsuit or two by now. Like whistleblowers or the lack thereof, history can be a useful though incomplete reference point.</p>

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<p>But higher ed does have its own equivalent of an industry consumer protection agency, via the National Association for College Admission Counseling. And NACAC has created something of student [bill</a> of rights](<a href=“http://www.nacacnet.org/AboutNACAC/Policies/Documents/StudentsRtsNEW.pdf/]bill”>http://www.nacacnet.org/AboutNACAC/Policies/Documents/StudentsRtsNEW.pdf/), including the following:

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<p>The value of that right is that it enables students to compare costs from one college to another. This is not limited to those who are relying on need based aid – there are also students who don’t qualify for such aid but may end up choosing a different college than anticipated because of an offer of merit aid, or because of some other offer the college makes to them (such as admission into a special honors program).</p>

<p>ED is an anti-competitive practice by which colleges persuade the students to give up that right. If the practice were limited to students who truly want to attend one college above all others, whatever the cost — then no one would be harmed. But colleges also manage to persuade others to buy into the ED system, by selling the idea that ED gives them a leg up on admissions. This probably is not true – the colleges which use ED generally accept 80-85% of their students via RD admissions, but they manage to convince a small fraction of their applicants that they need some sort of edge above others in order to win admission – and also convince those applicants that ED will give them that edge, despite the fact that it is NOT in the college’s interest to tie up spots with marginal, financially-needy candidates. (The whole purpose of ED is to fill those spots with paying and/or strong and/or hooked candidates, with “hooked” meaning “fills some institutional agenda”)</p>

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<p>^At top colleges, ED spots regularly fill 40-50% of the class, leaving 50-60% for RD. IIRC this is true for Penn and Swarthmore, likely many more. Also IIRC, Sally Rubenstone has said that Smith was more likely to take a marginal, financially-needy candidate during the need-blind ED round than during need-aware RD. I have been given no reason to think that she would lie outright.</p>

<p>ED is widely considered a minor hook in itself because of the commitment made to the school. Given a choice between two marginal, reasonably similar candidates, one in ED and one in RD–and since candidate pools don’t change dramatically from year to year, this type of comparison can be made in the abstract if not in the concrete–I would certainly pick the ED student every time because enthusiasm probably correlates with happiness which probably correlates with more campus engagement, academically and socially.</p>

<p>So this is another point of intractable disagreement: I believe that ED “probably” does give a small admissions boost, and that early commitment to one school is a reasonable price to pay for such a boost. Thus, from the POV that ED is a good choice in itself, I approach the financial aid portion with an eye to how it might successfully be integrated.</p>

<p>Just because students have the right to wait until May 1 to make a commitment, does not mean that all students should, as a matter of financial prudence, do so.</p>

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<p>“Reed claims to meet 100% need of its students. …”</p>

<p>Off topic, but it’s the same answer as this one:</p>

<p><a href=“http://talk.collegeconfidential.com/2670026-post80.html[/url]”>http://talk.collegeconfidential.com/2670026-post80.html&lt;/a&gt;&lt;/p&gt;

<p>The caveat is “… meets all admission and financial aid application deadlines.” If paperwork is late, but money is still available, students can receive some help.</p>

<p>"The document you posted is informational, but it is not “transparency”. …</p>

<p>It’s also very long. I wonder how much longer it could get and be transparent.</p>

<p>“ED is an anti-competitive practice by which colleges persuade the students to give up that right.”</p>

<p>You should say “I think …” because it is opinion. Or maybe that’s understood by all, without saying.</p>

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<p>When the CDS H2 i) says “On average, the percentage of need that was met of students who were awarded any need-based aid” the subject is dollars (where anything above 99.5% is rounded up), not students. So I suppose as long as the total number of dollars awarded to all students was at least 99.5% of their collective need, it could still be that one or more students did not receive more than 99.5% of their individual need. Maybe this is like a legal loophole. ;)</p>

<p>“I think the reason that we don’t see eye to eye is that with my legal background …”</p>

<p>Good point. I’m an engineer, where we’re satisfied when things generally function well enough, not always perfectly.</p>

<p>“… are able to get away with it because most of the time it works.”</p>

<p>Yes, and that’s my less cynical view, that ED works quite well most of the time for most people who use it (even when it’s unsuccessful). I don’t think ED should be abandoned just because it can’t work perfectly all the time for everyone.</p>

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<p>Lots of debates here about ED and such. It will be good reading next year as families weigh the pros/cons. </p>

<p>OP - Good luck to you and your daughter. I hope things work out for you. If you opt to not do the ED school, take advantage of all of the good info on the Colleges threads. (I started there and found Parents threads later. Wish I had found them earlier.)</p>

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<p>The fair comparison is the admit rate from each pool. There’s a larger pool of applications during RD. If the admit rates are the same from ED and RD, then there’s no advantage. Some students will still apply ED to those schools for other reasons than an admissions tip. We’ve mentioned other reasons upthread. </p>

<p>D1’s ED school releases very little information about ED statistics. They don’t announce what percentage of each class is filled by ED (though a reasonable guess is on the order of 25-35%). They don’t release separate acceptance rates for ED and RD. Official word from the Admissions Office is that they want to only admit students during ED who would also be admitted during RD, and they don’t want to stampede students into feeling they have to apply ED for the best shot at acceptance. It’s possible that they’re just gaming all of the ED applicants, who would otherwise be admitted in the spring. Pretty clever–the school coyly says that they’re not pushing ED, which then ends up convincing a bunch of tightly wound applicants and their parents that there is some secret advantage to going ED. ;)</p>

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<p>Exactly. Let’s take 3 families. Family A: two divorced parents, two households, each with income of $60k. Family B: married parents, one household with income of $60k. Family C: married parents, one household with income of $120k. Come up with a fair and equitable FA metric that applies to all three. It can’t be done. Someone’s ox will always be gored. </p>

<p>The transparency discussion reminded me of an active and contentious thread on the FA forum a few months ago, where a parent was getting a pre-read on FA from an HYP school. The school’s glossy brochures on FA had nice charts showing how families earning under such-and-such an amount would pay on average no more than 10% of their household income as COA. The pre-read came back with a percentage that was 20% or more, entirely unaffordable for the family. The problem was having a home-based business, which complicates the FA computation. My take-away lesson was that families have to be extremely skeptical about any kind of need-based (or merit based) aid until an offer is in hand, no matter how much information a school provides.</p>

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<p>I said it was de facto discriminatory, not intentional. That is, the application of a policy that is neutral on its face, but has a discriminatory impact – in this case, because of differing marriage and divorce rates among different ethnic/racial groups.</p>

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Because the phrase “full need” is an overt misrepresentation of what they are actually doing with their financial aid, when they are basing aid determinations on unilateral factors. They have redefined “need” to mean something that it would not mean in any other context. </p>

<p>I’m not willing to concede to other parties the right to change the definitions of words to suit their own purposes.</p>

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<p>That’s exactly right. That is why ED is an anti-competitive practice – it is the college’s way of avoiding having to compete with pricing for a significant percentage of their enrolled students. This ends up saving Swarthmore money, because students are confronted with a short deadline, strong emotional pressure in favor of enrolling, and limited information about costs. They are likely to be willing to pay more under those circumstances than they would be with a set of multiple options. (For example, Swarthmore has only about a 25% yield among its RD admits – 3 out 4 admitted students who have a choice will opt to go elsewhere --which suggests that outside of ED, Swarthmore is at a competitive disadvantage among its peers – hence their strong interest in locking in students early).</p>

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So–given that FAFSA is not any better a formula than the innumerable unique institutional formulas out there, for reasons already stated upthread–how would you fairly define “need”? To me, the phrase “full need” is not a misrepresentation because it cannot be any more precise in the context of financial aid at multiple colleges with reasonably differing opinions on how to distribute their money. I am too cynical to believe that the family’s idea of “need” is accurate most of the time.</p>

<p>I actually agree with you that ED is an anti-competitive practice–locks in yield, saves money because the ED pool has a higher proportion of full-pays, in part due to the issues surrounding FA+ED. However:</p>

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<p>My basic assumption is that Swarthmore, at least, is telling the truth when it says that need-based financial aid awards are the same for ED and RD. That is, I assume that Swarthmore does not practice preferential packaging aside from the very few merit scholarships.</p>

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<p>[Swarthmore</a> College :: Financial Aid :: FAQs: For Early & Regular Decision](<a href=“http://www.swarthmore.edu/x17668.xml]Swarthmore”>http://www.swarthmore.edu/x17668.xml)</p>

<p>Now, even with identical FA packages and being need-blind, ED still saves Swarthmore money–because the ED pool has more full-pay students than the RD pool, and so filling half of the class from both ED rounds results in a greater proportion of full-pay students without even trying.</p>

<p>From anecdotal accounts, Swarthmore–like many elite schools, Carnegie Mellon a notable exception–is not particularly amenable to negotiating FA even if a peer school offers more money. I’ve seen this happen not only with Yale, but with Williams, a direct competitor if ever there was one.</p>

<p>In contrast, your cited reasons for why Swarthmore saves money through ED are:</p>

<p>1) “short deadline” - I’m not sure why this matters very much, since RD results are months from releasing and EA results usually release at the same time. Students who apply ED are those for whom Swarthmore is their first choice–students who would happily accept in an instant if FA was not a factor, one presumes, no matter the decision round.</p>

<p>2) “strong emotional pressure in favor of enrolling” - I assume that the pressure you refer to is from the student/family, which is very true–it is a first-choice college, after all. But if ED didn’t exist, most of these students (excepting those who apply strategically, but that’s a different issue) would still feel strong emotional pressure in the RD round. If you are referring to emotional pressure by the college, then I can only say that I applied EDII and was not outwardly pressured at all, my only correspondence from Swarthmore being an acceptance letter that assumed I would be attending (something like 99% of ED admits will enroll, so not a wrong assumption).</p>

<p>3) “limited information about costs” - I assume that you mean the lack of ability to compare FA packages. In one sense, yes, cost information is limited because it is less than the maximum possible; but in another sense, cost information is perfectly adequate because, after all, the college is not asking you to enroll without knowing your FA package at THEIR school (the one that matters, since it is presumably your first choice).</p>

<p>Now, I do have one friend who was accepted ED at a private LAC that met full need but was not among the best-endowed or most well-known. Her package was doable, so she committed to enrolling and didn’t send out any other applications–but in spring, the LAC’s “final” package differed substantially from the fall estimated package. There were NCP issues complicating the matter. I believe that this type of situation is unacceptable and borders on malicious, because the student committed on the basis of a good-faith FA estimate and the college suddenly changed its mind after the student’s options were gone. (She ultimately enrolled at an EA safety that agreed to accept her after she had turned down the initial acceptance post-ED, so things turned out well but it was unfair and very tough emotionally.)</p>

<p>I reiterate: if you wish to compare FA packages, don’t apply ED. </p>

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<p>This point is true, but moot for schools–admittedly a small subset–that genuinely do not practice preferential packaging on the basis of need alone. I think that it would be a legal and political nightmare if schools stated outright that they did not do this, but actually did behind the scenes. There are always going to be disgruntled admissions and/or FA officers.</p>

<p>In summary, I believe that the ED round is profitable to schools like Swarthmore because more full-pays are admitted, not because FA students are given worse packages.</p>

<p>Is Swarthmore’s 25% RD yield abnormally low among its closest peers, e.g. Williams and Amherst? That’s a genuine question, as I’m feeling lazy tonight about research. Swarthmore also loses a lot of RD admits to Ivies, which represent a different educational choice (aside from HYP, the Ivies don’t have substantially better FA than AWS on the whole–individual mileage may vary, given differing formulas and financial situations).</p>

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<p>

You and vossron made similar comments on my point; maybe it’s a hole in my understanding. If you reject an ED offer, aren’t you at risk of similar schools in that tier dropping you from consideration? Isn’t that information shared? Seems that I’ve read that on these boards.</p>

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Now I definitely agree with this. It’s the point that I was making when I said that you need to be “totally insensitive to financial considerations” to make ED viable. I guess there are some people like that, but it would take an awful lot of money for me to casually write out $200k+ worth of checks!</p>

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<p>By the way, I strongly agree with calmom that the marketing language used by universities regarding “meeting need” is very deceptive, and that the overall FA process lacks transparency. It all seems to be a very anti-consumer system.</p>

<p>Still, there’s probably 99+% of us who should avoid the biggest self-inflicted wound that’s out there - ED.</p>

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<p>*ED is an anti-competitive practice – it is the college’s way of avoiding having to compete with pricing for a significant percentage of their enrolled students. *</p>

<p>You know, the latter part of that excerpt sounds like conjecture. I don’t know if it it is backed up anywhere-? </p>

<p>Why can’t we call ED a “competition-aware” practice? Why must it be phrased as though it were a conspiracy of some sort? Yes, it simplifies the work of admissions committees and, theoretically, offers a better yield. Yes, in many schools which publish stats, there is a larger % admitted ED than RD. No, I don’t believe we can definitively point to stats that more of these kids are full-pay. Finaid is offered. If it is insufficient, the kid can back out.</p>

<p>Btw, let’s not argue against media hype by…referring to info found in media articles- whether it’s NYT, Ebony, USNWR or you-name-it. Those articles are written by people who get paid to generate interest, for papers/magazines that survive only if issues are sold. </p>

<p>Likewise, re: generalized talk of discrimination in admissions, time is better spent referring to DOE’s statistics and various studies. Or, read the darned UC AA, preferential policy and admissions points edge documents. You know, the stuff the mag authors on deadlines don’t get to.</p>

<p>Every parent should have frank discussions with their kids about what they can afford for college. CC abounds with threads where kids have no idea. Parents express surprise that there are resource sites (eg, Finaid.org- flawed, but informative) or various calculators. Parents admit their lack of research and fret that their kids are now crushed.</p>

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<p>ED is not for folks who want to compare financial aid packages, for whatever reason–financial, emotional, risk-averse, on a whim. It CAN be for folks who are willing to accept the worst possible FA package that they can still afford under fiscally sound practices, </p>

<p>MisterK, I’m not going back to her whole post right now. But I thought she meant:</p>

<p>Let’s say, you hope to kick in 10k and they offer a package where you are required to pay 14k. That may be “the worst possible FA package that [you] can still afford under fiscally sound practices.” I don’t think she meant you could swing 200k. In this example, maybe 14k is eekable, but 18k would not be.</p>

<p>Also, re: colleges sharing admisison or finaid info with other schools: wasn’t there a DOJ suit about collusion that resulted in this ending? IMO, these guys are too busy today to call each other up and discuss Johnny and Mary.</p>

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<p>“If you reject an ED offer, aren’t you at risk of similar schools in that tier dropping you from consideration?”</p>

<p>Schools in communication that would (for whatever reason) offer you the same net FA could drop you; you couldn’t afford it the first time, so why try again?</p>

<p>But schools that want you more than the first did, or are able to offer more FA have no reason to drop you.</p>

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<p>When a student gets an ED offer they have a period of time within which to confirm their intention to attend. If they can’t afford it, they can decline. There’s no problem there with other schools – same tier or otherwise.</p>

<p>The issue of being branded somehow as an ED scofflaw relates only to students who confirm their intention to attend, put down the deposit, and then wait until their RD decisions come in and at the 11th hour bail on the ED school.</p>

<p>It has nothing to do with students who decline the ED acceptance early in the process and prior to the confirmation deadline.</p>

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<p>“Because the phrase “full need” is an overt misrepresentation of what they are actually doing with their financial aid, when they are basing aid determinations on unilateral factors. They have redefined “need” to mean something that it would not mean in any other context.”</p>

<p>So is your objection that FA is determined by applying formulas, or are the four letter words “full” and “need” the problem? I.e., is the way the systems works okay, but you don’t like the semantics?</p>