37. Provide transparent and consistent information about financial aid offers.

Finance 09.6.24

Here’s what state government can do:

  • State legislatures should require that all institutions of higher education in their state adopt standard definitions for their financial aid offer letters.

Here’s what institutional leaders can do:

  • Higher education institutions should ensure that financial aid offer letters are transparent and include information, such as:
      • Itemized cost of attendance
      • Explanation of all types of financial aid, including grants, scholarships, student loans, and student employment
      • Explanation of the terms and conditions on student loans as well as how much the debt will cost over time
      • Estimated net price

    [i]

    • Whether the financial aid is offered once, on an ongoing basis, or renewable
    • Next steps for accepting or declining the financial aid offer

Higher education institutions should provide students with transparent and comparable information about their financial aid offers.

Prospective and current college students, as well as their families, deserve support and transparency throughout the financial aid process. In 2022, the U.S. Government Accountability Office released a report with best practices to improve information on college costs and recommended that Congress consider legislation to require institutions of higher education to provide students with standardized information in their financial aid offers. According to the report, 41 percent of colleges do not include a net price in their financial aid offer letter, which may leave students to guess their cost of attendance. Furthermore, 50 percent of colleges are understating their net price.[ii]

[i]Net price for students is estimated by subtracting grants and scholarships from the total cost of attendance.

[ii]“Report to the Republican Leader, Committee on Education and Labor, House of Representatives, Financial Aid Offers, Action Needed to Improve Information on College Costs and Student Aid,” U.S. Government Accountability Office, November 2022. https://www.gao.gov/assets/gao-23-104708.pdf