Child’s Education, but Parents’ Crushing Loans

When Michele Fitzgerald and her daughter, Jenni, go out for dinner, Jenni pays. When they get haircuts, Jenni pays. When they buy groceries, Jenni pays

It has been six years since Ms. Fitzgerald — broke, unemployed and in default on the $18,000 in loans she took out for Jenni’s college education — became a boomerang mom, moving into her daughter’s townhouse apartment in Hingham, Mass.

Jenni pays the rent.

For Jenni, 35, the student loans and the education they bought have worked out: she has a good job in public relations and is paying down the loans in her name. But for her mother, 60, the parental debt has been disastrous.

“It’s not easy,” Ms. Fitzgerald said. “Jenni feels the guilt and I feel the burden.”

There are record numbers of student borrowers in financial distress, according to federal data. But millions of parents who have taken out loans to pay for their children’s college education make up a less visible generation in debt. For the most part, these parents did well enough through midlife to take on sizable loans, but some have since fallen on tough times because of the recession, health problems, job loss or lives that took a sudden hard turn.

And unlike the angry students who have recently taken to the streets to protest their indebtedness, most of these parents are too ashamed to draw attention to themselves.

“You don’t want your children, much less your neighbors and friends, knowing that even though you’re living in a nice house, and you’ve been able to hold onto your job, your retirement money’s gone, you can’t pay your debts,” said a woman in Connecticut who took out $57,000 in federal loans. Between tough times at work and a divorce, she is now teetering on default.

In the first three months of this year, the number of borrowers of student loans age 60 and older was 2.2 million, a figure that has tripled since 2005. That makes them the fastest-growing age group for college debt. All told, those borrowers owed $43 billion, up from $8 billion seven years ago, according to the Federal Reserve Bank of New York.

Almost 10 percent of the borrowers over 60 were at least 90 days delinquent on their payments during the first quarter of 2012, compared with 6 percent in 2005. And more and more of those with unpaid federal student debt are losing a portion of their Social Security benefits to the government — nearly 119,000 through September, compared with 60,000 for all of 2007 and 23,996 in 2001, according to the Treasury Department’s Financial Management Service.

The federal government does not track how many of these older borrowers were taking out loans for their own education rather than for that of their children. But financial analysts say that loans for children are the likely source of almost all the debt. Even adjusted for inflation, so-called Parent PLUS loans — one piece of the pie for parents of all ages — have more than doubled to $10.4 billion since 2000. Colleges often encourage parents to get Parent PLUS loans, to make it possible for their children to enroll. But many borrow more than they can afford to pay back — and discover, too late, that the flexibility of income-based repayment is available only to student borrowers.

Many families with good credit turn to private student loans, with parents co-signing for their children. But those private loans also offer little flexibility in repayment.

The consequences of such debt can be dire because borrowers over 60 have less time — and fewer opportunities — than younger borrowers to get their financial lives back on track. Some, like Ms. Fitzgerald, are forced to move in with their children. Others face an unexpectedly pinched retirement. Still others have gone into bankruptcy, after using all their assets to try to pay the student debt, which is difficult to discharge under any circumstances.

The anguish over college debt has put a severe strain on many family relationships. Parents and students alike say parental debt can be the uncomfortable, unmentionable elephant in the room. Many parents feel they have not fulfilled a basic obligation, while others quietly resent that their children’s education has landed the family in such difficult territory.

Soon after borrowing the money for Jenni’s education, Ms. Fitzgerald divorced and lost her corporate job. She worked part-time jobs and subsisted on food stamps and public assistance.

Source : nytimes.com

College Credit Eyed for Online Courses

While massive open online courses, or MOOCs, are still in their early days, the race has begun to integrate them into traditional colleges — by making them eligible for transfer credits, and by putting them to use in introductory and remedial courses

On Tuesday, the American Council on Education, the leading umbrella group for higher education, and Coursera, a Silicon Valley MOOC provider, announced a pilot project to determine whether some free online courses are similar enough to traditional college courses that they should be eligible for credit.

The council’s credit evaluation process will begin early next year, using faculty teams to begin to assess how much students who successfully complete Coursera MOOCs have learned. Students who want to take the free classes for credit would have to pay a fee to take an identity-verified, proctored exam. If the faculty team deems the course worthy of academic credit, students who do well could pay for a transcript to submit to the college of their choice. Colleges are not required to accept those credits, but similar transcripts are already accepted by 2,000 United States colleges and universities for training courses offered by the military or by employers.

Coursera, founded last year by two Stanford computer professors, Daphne Koller and Andrew Ng, has 33 university partners and nearly two million students, who currently can earn certificates of completion, but not academic credit, for their work.

“I feel strongly that degrees are really valuable to people, and having MOOCs allow for credit down the line will increase the number of students with the confidence and wherewithal to complete degrees,” Professor Koller said. “If you’re a random student from another country, what are your chances of being admitted to a university here? But if you can show you’re a motivated student who’s completing five courses and done well on the proctored exam, I think a university would pay attention.”

The project is being watched closely by higher-education experts who expect MOOCs to broaden access to higher education and bring down the costs.

“With the additional benefits of ACE credit recommendation for Coursera courses, students will have an unprecedented opportunity to obtain recognized credentials for their work,” said William G. Bowen, the former president of Princeton University and the Mellon Foundation, and senior adviser to Ithaka, a nonprofit group devoted to digital technologies in higher education.

Also on Tuesday, the Bill and Melinda Gates Foundation announced 13 grants, totaling more than $3 million, for MOOC research. The grants are intended to encourage the development of MOOCs in introductory courses, like developmental math and writing, to see how they might be integrated into community colleges to bolster completion, and to develop a pathway for MOOC transfer credit.

While there is some overlap between the Coursera project and the Gates grants, only four of the nine schools that received grants are putting their MOOCs on Coursera, while the others use different platforms.

The largest grants go to three groups — the American council, Ithaka and the Association of Public and Land-Grant Universities — that will explore the credit issue, consider a possible consortium for collaborating on digital courseware, and research the University of Maryland’s experience with MOOCs.

“It certainly appears that there is potential here, and we ought to kick all the tires and see what we can learn,” said Molly Corbett Broad, the president of the American council

Source : nytimes.com

Enrollment in Charter Schools Is Increasing

Although charter schools engender fierce debate — most recently over ballot measures in Georgia and Washington State — their ranks are growing rapidly, according to a new report. Between 2010-11 and 2011-12, the number of students in charter schools increased close to 13 percent, to just over two million. 

The National Alliance for Public Charter Schools, a nonprofit advocacy group, released the report on Wednesday. It showed that in some cities, charter schools — which are publicly financed but privately operated — enroll a significant proportion of public school students.

New Orleans, where the city’s schools were essentially destroyed by Hurricane Katrina, leads the nation in the proportion of students in charter schools, at 70 percent. But in six other districts, including Detroit, Washington, D.C., and St. Louis, more than 30 percent of public school students attend a charter school.

According to the report, in 110 school districts, at least 10 percent of students now attend public charter schools, up from 96 a year earlier.

“To the extent families are in need of other options, growth does indicate there is something missing in the public school system,” said Nina Rees, chief executive of the National Alliance.

Opponents argue that charters drain public resources from traditional schools, and tend to attract motivated students, leaving behind those harder to educate.

The performance of charter schools has been mixed, with some helping students achieve higher test results than traditional neighborhood schools, but many others delivering similar, or worse, results.

The fate of a ballot measure in Washington allowing charter schools in the state for the first time has not been determined. In Georgia, a measure creating a new state commission to approve charter schools passed.

In New York City, just over 48,000 — or about 5 percent — of public school students attended charter schools in 2011-12, up 24 percent from the previous year.

Source : nytimes.com