CBSL: Poll Results

Coalition for Better Student Loan Survey Findings

Following are the results of a nationally representative telephone survey of 400 college students, conducted August 24 – 29, 2003. The margin of error for the study is +/- 4.9% at the 95% confidence level. Full survey results are appended at the end of this memo.

Key Findings

	Student loans are critical to today’s college and university students. Two-thirds of students or their family members currently depend on these loans to pay college expenses.

	College students believe the student federal loan program is even more important than in past years – both in personal terms and in terms of investing in the future of our country.

	However, these students significantly overestimate how much a student can currently borrow in a given year and, when told, strongly believe the maximum amount is too low to cover college expenses.

	Further, students want Congressional action – an increase in the amount students and their families can borrow each year to pay for college expenses. Given their ideal, the current amount would more than triple to a mean of $8,963 per year.

	If not able to borrow enough federal loans to cover their college expenses, many students say they would engage in behaviors that could put their higher education and their future financial stability at risk –working more hours during the school year, taking out private or alternative loans or borrowing money from family and friends.

Student Loans

Dependence on student loans is pervasive. Two-thirds of students (65%) either have student loans themselves or have family members who have/had student loans. Just 34% of college students report being loan-free.

Those most likely to have student loans themselves or to have family members who have/had student loans are:

-	93 percent of participants agreed with the statement: "Federal student loans are a good investment in the future of America.”
-	Students ages 25 and older (82%)
-	Those in the Northeast (84%)
-	Students enrolled in a private college or university (77%)
-	Students enrolled in a four-year college or university (73%)

The federal student loan program is important than ever, according to college students. Nine out of ten students (92%) agree that financial assistance provided to low and middle income students and families is more important today than it was just a few years ago – including 59% who agree strongly. Only 7% disagree.

-	At least eight in ten students across every demographic subgroup see the federal student loan program as more important today than just a few years ago.
-	Latino students(1) (100%), students in the Northeast (97%), and part-time students (93%) are most likely to agree.
-	Those with personal or family experience with student loans are more likely to agree (90%) than those who do not have student loans or have family members who have/had student loans (79%).
-	Additionally, students who are working more than 20 hours a week are more likely to agree (89%) than those working fewer than 20 hours per week (77%).

Further, the importance of student loans goes beyond personal financial assistance. Students nearly unanimously agree (96%) that federal student loans are a good investment in the future of America - with 70% who agree strongly. In fact, at least eight in ten students across every demographic subgroup see federal student loans as a good investment in America’s future. Only 4% disagree.

Myth vs. Reality

College students significantly overestimate the current maximum amount a college student can borrow through the federal student loan program. A majority of students (54%) believe the allowed maximum is $10,000 or more, with 28% saying over $16,000. The mean amount given is $21,495.

-	Just 30% believe the maximum is $10,000 or less.
-	Not surprisingly, those who have received student loans are more likely to say the maximum is $6,000 or less (33%) than those without loans (18%).

When told a student in their first year of college can borrow a maximum of $2,625 through the federal student loan program, three-quarters say this is too low to pay for college expenses. Only 2% say this is amount is more than is needed. Twenty-two percent say this amount is just about right.

-	College students who have loans themselves or have a family member who has/had student loans are most likely to say this amount is too low (81%), compared to 65% who do not have personal or family experience with loans.
-	Students attending a four-year college are more likely than those attending a two-year college to say the loan amount is too low (81% vs. 65%).
-	Those attending two-year public schools are among the most likely to say the amount is just about right (36%)

Congressional action

Students overwhelmingly believe Congress should change the 1992 limits and increase the amount students and their families can borrow each year to help pay for college expenses. Nine-in-ten (91%) say the maximum loan amount should be increased. Only 9% say they believe the amounts seem high enough.

-	More than eight in ten students across all demographic subgroups believe the maximum amount should be increased by Congress.
-	Notably, there is no significant difference between students attending public versus private colleges or universities (90% and 92%, respectively, say Congress should increase the maximum federal student loan amount) or those attending two- versus four-year colleges (88% and 92%, respectively, say Congress should increase the maximum federal student loan amount).

In fact, students would more than triple the current amount. Asked to give the ideal maximum amount a student should be able to borrow through the federal student loan program for each year of college, students offer a mean amount of $8,963.

-	One-third (33%) say the amount should be between $4,501 and $7,500, while 36% say the amount should be more than $7,500 (including 33% who say more than $10,000). Just 16% say the amount should be $4,500 or less.
-	Those attending public colleges or universities are more likely than those attending private schools to say the ideal amount is $4,500 or less (22% vs. 6%).

Faced with the reality that Congress has limited resources, 84% of college students say Congress should use these resources to help current and future students pay for college, rather than help those who have already graduated repay their loans (16%).

-	Those in the Northeast (26%) and older students (26%) are more likely to say Congress should focus its resources on helping those who have graduated to repay their loans.

Alternatives

Seventy-eight percent of students say they work – or will work – during the school year to pay for college. One-in-five (21%) say they will not work.

In fact, a plurality of those who report that they do or will work say they will work 30 or more hours a week. Of those who work or plan to work, 42% work or plan to work 30 hours a week or more (including 22% who work or plan to work 40 hours a week or more).

-	Those attending a four-year private college or university are more likely (78%) than those attending a four-year public school (67%) to work.
-	Additionally, those attending a two-year college or university are more likely to work (91%) than those attending a four-year school (72%).

Overall, those most likely to work during the school year include:

-	Older students (89%) – these students are also more likely to work 40 hours per week or more (47%)
-	African-American students (94%) (2)
-	Part-time students (94%)
-	Those attending two-year schools (91%) – these students are also more likely to work 40 hours per week or more (34%)

Students would be forced to engage in risky behaviors if they could not borrow enough from the low-interest federal program to cover their college or university expenses. If they needed a student loan and could not borrow enough through the federal program, two-thirds (64%) of students say they would work additional hours at a full or part-time job while enrolled in school.

-	Seven-in-ten (71%) of those already working 20 hours or more per week say they would add hours to their work schedules.
-	Younger students (18-20 years old) are also more likely (70%) to pursue this option than their older counterparts (52%).

Additionally, 50% say they would take out a private or alternative student loan, a personal line of credit or a home equity loan to pay for school and 47% say they would borrow the money for school from their parents, other family members or a friend. Nearly four-in-ten (39%) say they would take time off from school to work and save money.

Alternatives slight less likely to be used by college students include their parents taking out a private or alternative student loan, personal line of credit or a home equity loan (30%), reducing their course load (26%), and using a credit card to cover additional college-related expenses (22%).

(1) Note: Small sample size (n=22)
(2) Note: Small sample size (n=26).

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Coalition for Better Student Loans
Survey on Financial Aid

400 Interviews of College Students Nationwide
Estimated Margin of Error: +/-4.9%

August 22 – September 1, 2003

All numbers are percentages
* indicates less than 1%
Numbers may not total 100% due to rounding

SCREENING

First I need to ask you a few questions to make sure we are interviewing a range of respondents. Again, all of your answers are strictly confidential.

S1.

Are you currently enrolled either part-time or full-time at a college or university?

	Total
Yes—part-time	27
Yes—full-time	73
No	TERMINATE
Don’t know/refused (VOLUNTEERED)	TERMINATE

S2.

Which one of the following best describes the college or university where you are enrolled?

	Total
A two-year public community college	30
A public four-year school, like a state college or university	35
A private two-year college, like a junior college	3
A private four-year college or university	32
A private trade or career school	-
Don’t know/refused (VOLUNTEERED)	-

STUDENT LOAN QUESTIONS

We are going to talk a little bit about the federal student loan program that helps students and their families pay for college. Through the federal student loan program, the federal government offers financial assistance to low and middle income families through low interest loans. The maximum amount that a college student can borrow is set by Congress.

Based on what you know, what would you say is the current maximum a college student can borrow through the federal student loan program?

	Total
$0 - $6,000	24
$6,000 – $10,000	4
$10,000 - $16,000	16
$16,000+	28
Don’t know/refused (VOLUNTEERED)	28
Mean Amount	$21,495

The maximum amount a student could borrow in their first year of college through the federal student loan program is two thousand six hundred and twenty-five dollars. Do you think that amount sounds …

	Total
Too low to pay for college expenses	76
Too high and more than is needed to pay for college expenses	2
Just about the right amount	22
Don’t know/refused (VOLUNTEERED)	1

The maximum amount students can borrow each year through the federal student loan program was set by Congress in 1992 and has not changed since. A proposal has been made to Congress to increase the amount students and their families can borrow each year to help pay for college expenses. In your opinion, would you say the maximum loan limits should be …

	Total
Increased by Congress so students and their families can borrow more money to pay for college	91
Kept at the same level because these amounts seem high enough	9
Don’t know/refused (VOLUNTEERED)	1

What do you think SHOULD be the maximum amount a student can borrow through the federal student loan program for each year of college?

	Total
$0 - $4,500	17
$4,501 - $7,500	33
$7,501 - $10K	4
$10,001+	33
Don’t know/refused	14
Mean Amount	$8,963

Please tell me if you AGREE or DISAGREE with this statement. The financial assistance provided low and middle income students and families through the federal student loan program is more important today than it was just a few years ago. Do you STRONGLY (agree/disagree) with that statement or just SOMEWHAT (agree/disagree) with it?

	Total
Strongly agree	59
Somewhat agree	33
Somewhat disagree	6
Strongly disagree	1
Don’t know/refused (VOLUNTEERED)	1
Total Agree	92
Total Disagree	7

The federal government only has limited resources to fund the student loan program. If you had to make a choice about how these resources should be spent, would you say the more important priority for the government should be …

	Total
Offering greater financial assistance to current and future students so they have the financial resources to pay for college	84
Offering greater assistance to those who have graduated from college to help them repay their student loans	16
Don’t know/refused (VOLUNTEERED)	1

Please tell me if you agree or disagree with the following statement: Federal student loans are a good investment in the future of America. Do you STRONGLY (agree/disagree) with that statement or just SOMEWHAT (agree/disagree) with it?

	Total
Strongly agree	70
Somewhat agree	26
Somewhat disagree	3
Strongly disagree	1
Don’t know/refused (VOLUNTEERED)	-
Total Agree	96
Total Disagree	4

If you personally needed a loan to finance your education and could not borrow enough from the low-interest Federal program to cover your expenses, which of the following, if any, would you do? Please indicate all that apply.

	Total
Work additional hours at a full or part-time job while enrolled at school	64
I would take out a private or alternative student loan, personal line of credit, or a home equity loan	50
My parents would take out a private or alternative student loan, personal line of credit, or a home equity loan	30
I would use a credit card to cover additional college-related expenses	22
Borrow money from parents, other family members, or friends	47
Reduce the number of courses you were taking	26
Take time off from school to work and save money	39

Other (VOLUNTEERED)	1
None of the above (VOLUNTEERED)	2
Don’t know/refused (VOLUNTEERED)	2

DEMOGRAPHIC QUESTIONS

Finally, I have just a few questions for statistical purposes only.

In order to ensure that we are talking to people of all ages, can you please tell me the year you were born?

	Total
Under 18	*
18 – 20	41
21– 24	44
25+	15
Don’t know/refused (VOLUNTEERED)	*

10.

Thinking about you and your immediate family, have you or someone in your immediate family received student loans, either today or in the past? And was that you that received student loans, someone else in your immediate family or both?

	Total
Yes, self	28
Yes, other	13
Yes, both	25
Total Yes	65
No	34
Don’t know/refused (VOLUNTEERED)	1

RESUME ASKING ALL

11.

Do you, or will you, work during the school year to pay for college?

	Total
Yes	78
No	21
Don’t know/refused (VOLUNTEERED)	1

12.

ASK ONLY IF Q11=1; N=316: And, how many hours do you or will you work per week on average?

	Total
Less than 10	7
10-19	24
20-29	25
30-39	20
40+	22
Don’t know/refused (VOLUNTEERED)	1

13.

Finally, would you mainly describe your racial or ethnic heritage as white, black, Hispanic, Asian or something else?

	Total
White	75
Black	7
Hispanic	5
Asian	9
Something else	4
Don’t know/refused (VOLUNTEERED)	1

14.

Gender (DO NOT ASK: OBSERVATION ONLY)

	Total
Male	49
Femail	51

Key Survey Findings

Background: In July 2003, The Coalition for Better Student Loans commissioned a survey of 800 likely voters, conducted by Public Opinion Strategies and Hart Research to gauge their thoughts on the federal student loan program. Several of the key findings are summarized below.

The vast majority of respondents (83 percent) believe the federal student loan program is more important today than it was a few years ago.

- 93 percent of participants agreed with the statement: "Federal student loans are a good investment in the future of America.”

Participants overwhelmingly agree that current Stafford loan limits do not meet the needs of students and their families in paying for college expenses.

- 88 percent of respondents say Congress should increase the current maximum Stafford loan limits so students and their families can borrow more money to pay for college.

- Participants suggested increasing borrowing limits to a mean amount of $10,111. Current loan limits range from $2625 in freshman year, to $5500 in senior year.

Voters surveyed believe the government's priority should be to help current and future students pay for college as opposed to helping college graduates repay their loans.

- 81 percent of participants support offering greater financial assistance to current and future students, as opposed to offering additional financial support to programs that help those who have already graduated from college repay their loans.

- Among the 54 percent of respondents who had received student loans or had an immediate family member who was a student loan borrower, 83 percent stated that the student loan program should place priority on helping current and future students.

Public Opinion Strategies also conducted two focus groups on behalf of the Coalition for Better Student Loans. Both focus groups were conducted in Bethesda, Md., on July 31, 2003. The first group was conducted among parents with household incomes of $40,000 - $80,000 who have children in high school, college, or are recent college graduates. The second group was conducted among “opinion elites,” who had received financial assistance themselves to finance college. Opinion elites are defined as higher-income college graduates, who pay close attention to news and current events. Many of the opinion elite participants were also parents, so they had this additional perspective.

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