Financial aid

juliuscesar1212 · November 24, 2008, 1:54am

Worldwide financial crisis jeopardizes student loans
College students from outside the U.S. run into a financial aid cash crunch
By Christian Gaston

The Forest Grove News-Times, Nov 19, 2008, Updated Nov 19, 2008 (1 Reader comment)

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When Kelly Wild decided she wanted to be an eye doctor, she cast her gaze on Pacific University in Forest Grove.

Things were going swimmingly for the 36-year-old optometry student from Regina, Saskatchewan until September, when CanHelp, a financial aid group that helps Canadian students secure college loans suddenly cut off her cash supply.

It turns out that CanHelp was backed by Wachovia Corp., the troubled North Carolina bank which fell victim to the teetering U.S. economy in September and was gobbled up by Wells Fargo.

Wild was able to secure a $20,000 loan from her Canadian bank, but that only covered two-thirds of what shed been counting on. Its kind of daunting, Wild said. Youre in your last year of schooling and youre $10,000 short.

Wild said shell be able to get through this year by scrimping and saving shes too far into her degree to quit.

For me, Im six months away from graduation and nothings going to stop that, Wild said.

Staying home
Wilds predicament isnt uncommon. International students around the metro region are quickly realizing that the economic instability thats turned the stock and currency markets into daily seesaws can mean the evaporation of thousands of dollars worth of college savings.

And after all, being a college student in a foreign country is always tricky.

But this year, college advisors are worried that credit panics in Europe and Asia coupled with the decline of a number of currencies worldwide could create a perfect storm, forcing many students who would have studied in the United States to stay home.

At Oregon State University, international students already are lining up for scholarships in preparation for tough times.

Our scholarship requests more than doubled this year, said Laurie Lewis, assistant director of international student and faculty services at Oregon State. I think that is indicative of all thats going on.

Visas limit work options
Judy Van Dyck, director of international affairs at Portland State University, whose office provides aid and academic direction to the universitys 1,552 international students, said foreign students are especially vulnerable to economic turmoil.

Tuition for international students is higher than domestic students, financial aid is scarce, and their student visas prevent them from working off campus for more than 20 hours a week.

Were very concerned, and were trying to follow this closely, said Gil Latz, vice provost for international affairs at Portland State.

The irony is because the dollar is weak, theres a great deal of interest across the world to pursue studying in the United States, Latz said.

But with world financial markets gyrating daily, its likely that more and more students will find themselves in Wilds shoes.

Megan Serenco, who advises the 155 international students at Pacific University, said that as finances tighten, universities could see students from Korea or other vulnerable countries packing up and heading home.

Im crossing my fingers, she said. We havent lost anybody yet and hopefully well be able to maintain the growth that weve seen over the last few years.

Currency fluctuations hit hard
With the bills racking up, a slight (or, in some cases, drastic) drop in the value of a students home currency can make a big difference.

Yu Nakao, an international student at Portland State, said the Japanese yen has held its value while the dollar has slumped, so shes not feeling the pinch yet.

But with tumultuous markets, its hard to figure out when to transfer money into the United States.

Who can predict when to hedge or bring in the big blob of money on a wire transfer? Van Dyck said.

If parents save a set amount for their students fees and tuition, and their currency takes a dramatic dive, it can become difficult to pay bills.

Van Dyck said if problems in the markets persist, universities could see students in trouble as early as January.

Markets affect aid availability
When Vamsi Parasa, an Indian electrical engineering student, applied for doctoral programs last winter, he assumed that if he was accepted, financial aid would be available. That was last year.

Since doctoral aid comes from private funds, international students like Parasa are eligible, but this year all three universities Parasa applied to said they didnt have resources to cover his tuition because losses in stocks and bonds reduced the amount of money from foundations and trusts.

I was kind of depressed, and my entire family was upset, said the Portland State University student. I already paid $35,000 for my masters program. For me to spend another $15,000 to $20,000 in a year was really depressing.

Luckily for Parasa, his brother took a new job in Texas that allowed him to help.

If my brother hadnt gotten a good job, I would have had no choice but to exit the United States, Parasa said.

Financial aid is scarce for most international students, so they often rely on loans from their home country or private loans. Foreign students arent eligible for federal financial aid.

While public institutions are limited in the amount of financial support they can offer international students, Reed College is free to spend the schools endowment on international aid.

Many students from India or Ghana receive financial aid packages that cover all but $4,000 of Reeds $48,110 annual tuition.

That insulates international students at Reed, who make up about 7 percent of the student body, from some of the effects of the financial crisis.

But Paul Marthers, dean of admission, thinks that this coming year fewer foreign students will apply to Reed.

Marthers also expects that a weak U.S. economy will reduce proceeds from the colleges investment funds, putting a crunch on aid for next year as well. If that happens, international aid might get cut.

We may have to strategically say, Well look at all the domestic students who need the money here and well put it there, Marthers said.

Optometrys Canadian connection runs deep
If youre going to be a Canadian optometrist, youre likely headed stateside for an education.

Thats because there are only two Canadian higher education institutions that offer the major. One is extremely exclusive and the other teaches in French.

As the only optometry school in the Pacific Northwest, Pacific University has drawn a number of Canadian students over the years. In fact, according to university officials, nearly a fifth of the Optometrys Schools Class of 2009 comes from north of the border.

Financial aid

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