College Planning Specialists: What the Nation’s 6 Largest Student Loan Providers Do NOT Want You To Know

In my last article, I began the process of throughly outlining what is one of the most overlooked yet greatest methods of financing a college education: College Planning Specialists. In previous months I have reported on the banking scandal that rocked University of Texas and other large institutions. This scandal involved the use of kick backs and illegal perks or payments made to large university student loan counselors. The trade off being those university officials would “steer” students and families into a loan program, from the kickback inducing bank, that was detrimental to the family.

In June of this year, Attorney General Andrew Cuomo of New York outlined and implemented a Code of Conduct plan for the 6 largest student loan lenders. Cuomo’s plan includes the following 7 provisions:

1. Ban on Financial Ties. Lenders are prohibited from giving anything of value to any college in exchange for any advantage sought by the lender. This severs any inappropriate financial arrangements between lenders and schools and specifically prohibits “revenue sharing” arrangements.

2. Ban on Payments for Preferred Lender Status. Lenders may not pay or give colleges any financial benefits whatsoever to get on a college’s preferred lender list.

3. Gift and Trip Prohibition. Lenders are prohibited from giving college employees anything of more than nominal value. This includes a prohibition on trips for financial aid officers and other college officials paid for by lenders.

4. Advisory Board Rules. Lenders are prohibited from paying college employees anything of value for serving on the advisory boards of the lenders.

5. Call-Center and Staffing Prohibition. Lenders must ensure that employees of lenders never identify themselves to students as employees of colleges. No employee of a lender may ever work in or providing staffing assistance to a college financial aid office.

6. Disclosure of Range of Rates and Defaults. Lenders must disclose to any requesting school the range of rates they charge to students at the school, the number of borrowers at each rate at the school, and the lender’s historic default rate at the school. This will ensure that schools will have the information they need to select preferred lenders who are best for students and their families.

7. Loan Resale Disclosure. Lenders shall fully and prominently disclose to students and their parents any agreements they have to sell loans to any other lender.

Look at these provisions carefully. Would you want to collaborate or become a customer of an organization that is being reprimanded for provisions 2 and 3. Essentially these are rules against kickbacks. Does it not make sense to search for an alternative to the stratospheric, exorbitant costs of college tuition loans?

What would you rather have as your plan to finance a student’s education: a high interest rate and long term loan that creates financial unrest for your family for years or a financial plan that allows you to take advantage of the millions of dollars of government financial aid that goes untapped every year?

Stay tuned as the series about College Planning Specialists continues with a closer look at the services and value they provide.

College Students Preparing for Work Life: “Consulting” (Entrepreneurial Career) Can Be Lucrative And Absurd

Courtesy of www.pendotech.com

You have spent the majority of your life learning, preparing, and fretting over the next step: work life aka “real world.” In that time you have concentrated your studies on a major-minor core curriculum. While you were performing your best work, you kept an eye on your eventual job prospects. Summertime was for internships and making business connections so that your transition from college life could be a smooth and rapid one. Finally you girded yourself for the possibilities that you will have to look long and hard for the job and career you want.

After all of this preparation, I bet nobody informed you about the world of “consulting.” It is entrepreneurial and it’s main requirement is that you have “expertise” in a specific field. This knowledge and your ability to bring this knowledge forward in a manner that is instructive are the major necessities to becoming a consultant-and hanging out your own shingle.

Now the fun part. The following story is true and it was reported in the October 11, 2007 San Francisco Chronicle “Bay Area” section of the paper-the headline reads:

Berkeley:

“LAW SCHOOL DROPS BOALT, $25,000

“Officials at UC Berkeley’s Boalt Hall School of Law spent nearly $25,000 on a branding consultant to help them give the school a new name: ‘UC Berkely School of Law.’ . . . “Dean Christopher Edley Jr. said the money was-spent because people will now understand that the law school is tied to UC Berkeley.”

HUH? WAH? You mean to tell me one of the preeminent academic officials in one of the most respected universities in the world deemed it necessary to hire a “consultant” to formulate that brand name? How utterly absurd is the thought that all of this brainpower at the disposal of UC Berkeley through administrators, professors, and students was never tapped?

Analysis:

Why didn’t the UC Berkeley brains behind this branding move simply poll their professors, adminstration, alumni, and current students? Why not open it up as if it was a “Branding” contest: Winner receives a $10,000 grant?

Instead Marshall Strategy Inc. was handed a $200,000 contract to “design the school’s magazine, Web site and brochures for fundraising and student recruiting.” Within this $200 “large” was the $25k fee for the “name.”

Even more disturbing is the fact that UC Berkeley has allowed a wonderful opportunity in public relations and recruiting slip through it’s fingers. How great a tool would it be for the university to have tasked it’s Business school and Law school with the jobs of branding, media brochure materials, publicity, and marketing?

Why not give the consulting contract to it’s own students? Why not keep the money in-house? Why not use this type of project as a senior thesis which could provide real world experience a graduate could point to when interviewing for a position?

Finally why not bring the component of blogging into the picture? Blogging or citizen journalism would be a wonderful course that every business school should, unfortunately administration does not get it, provide in it’s curriculum.

Incredulous is the idea that anyone with half a brain could have come up with this “branded” moniker. What is wrong with this picture besides the fact that it must make every UC Berkeley student wonder where their hard earned tuition fees are being spent?

So there you have it in a nutshell. Consulting is a business and it is lucrative. It does not necessarily require brains or even expertise. It requires the skill of being able to sell even the most absurd idea to the smartest people without those smart people pushing back your idea.

Go forth and conquer! Young consultants unite and prosper.