Penn’s net-price calculator may have a new rival in the form of a college cost comparison tool that is in beta testing by the Consumer Financial Protection Bureau.
Earlier this month, the CFPB released an interactive online tool called the “Financial Aid Comparison Shopper” as part of its “Know Before You Owe” student loan project.
The website allows families to compare the costs of more than 7,500 schools by displaying metrics such as estimated monthly student loan payment after graduation, grant and scholarship offers and the financial stability of an institution’s graduates.
Students can also enter their actual financial aid packages from different schools and compare the long-term costs of the packages.
Dean of Admissions Eric Furda said the comparison aspect of the CFPB tool may be useful for high-school seniors who are deciding where to commit by early May. However, he expressed concern that the tool’s default option — which shows “total borrowing” — may mislead students into thinking that Penn includes loans as part of its financial aid packages.
Director of Student Financial Aid Bill Schilling expressed similar concerns.
“This website takes the difference between the cost of attendance and the average grant, and provides after-school debt information based on the assumption that the student or family will be borrowing the difference, without consideration for other options of meeting that difference (e.g. work-study, family contribution, etc.),” he wrote in an email.
Furda said since this is the default option, it could confuse students about Penn’s no-loan policy.
“I think most people will just put the names of schools in and then they are simply viewing the difference between our average grant and sticker price and it puts the difference all into the category of loans and debt payments,” Furda said. “The directions aren’t clear that this is the default.”
Schilling said this may not serve to simplify the comparison process for students and families.
“I am concerned that the site will be misleading,” he said. “At this point, I do not see that it would bring any clarity to students and their families.”
CFPB spokesperson Michelle Person wrote in an email that the beta version of the tool is “designed for students who have received financial aid offers” and that students could calculate the debt burden of their actual financial aid packages, which may include work-study and family contribution.
She added that students who are beginning to research schools could use hypothetical scenarios to benefit from the tool as well.
Michael Goran, a 1976 College graduate and founder of IvySelect College Consulting, said the effectiveness of the tool for students who are applying to Penn may hinge on how much families will take the time to go beyond the default option.
“Logically, of course it’s helpful, but it’s not helpful if you don’t have all the accurate information you need to make an informed decision,” he said.
He added that the tool may help spread the message that Penn’s sticker price is not necessarily the price that students will be paying since the “total borrowing” amount stems from the difference between the two.
Aloke Desai — who was admitted regular decision from Indian Hill High School in Cincinnati, Ohio — said, “It looks like a great site but seems almost irrelevant for schools that are now loan-free,” upon an initial visit to the website.
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