Families that counted on money from refinancing their houses are finding that impossible as home values drop. Many parents are reeling from pay cuts and lost overtime. Others fear losing their jobs while paying tuition.
The economic jitters have changed the dynamic of college financing. This is the time of year when families of high school seniors are receiving tax documents and applying for aid. Many are embracing alternative strategies: staying local to avoid room and board costs, or applying only to state schools. Students already in college are transferring at higher rates than anyone can remember - from private colleges to public ones, or from four-year campuses to less expensive and increasingly crowded community colleges.
Local SUNY campuses are receiving record numbers of applications. At Stony Brook University, freshman applications are up more than 4 percent compared with the same time last year - and last year saw a record 28,337 applications. Overall, applications to Stony Brook are up more than 56 percent since fall 2005. Over the same time, admissions standards tightened: while 50 percent of applicants were accepted in 2005, only 39 percent were last year. Transfers to SUNY are soaring, too. For example, they rose 62 percent at Old Westbury last fall.
Many parents say they have lost the optimism of a year ago, when they felt the economy would rebound.
"Scared to death" about costs
"I'm scared to death about paying for college," said Claire Stodolski of East Meadow. It took her more than a year to find a job as a medical assistant after losing one in the airline industry. Stodolski, whose daughter is a senior, spoke after a college financial aid presentation at East Meadow High School this month.
College financial aid offices say they are fielding unprecedented numbers of requests for help. The federal government uses a formula to determine the expected family contribution, but colleges are allowed to make "professional judgment considerations" for those trying to recover from loss of income, high medical bills or similar setbacks. At Molloy College, those requests have almost doubled. At Hofstra University, they more than doubled - from 227 to 518.
Federal financial aid applications in New York State increased by more than 12 percent through December compared to the prior year. Many private universities have boosted their aid budgets to meet the rising financial needs of their students.
Some see hope in President Barack Obama's call last week to cap repayment of student loans at 10 percent of a graduate's income and forgive remaining debt after 20 years rather than the current 25.
One gauge for the new economic reality is the crowds at workshops led by Jacquelyn Nealon, who oversees the admissions office at New York Institute of Technology in Old Westbury. A few years ago, one or two parents might approach her to admit they had lost a job or racked up debt. They'd speak in hushed tones to make sure no one else overheard.
Parents speak up about finances
No longer. Parents stand up in auditoriums and announce their financial woes. "There's no shame any more in talking openly and candidly about your financial circumstances - it's become socially acceptable," Nealon said.
The stories of some of the 200 parents attending her presentation at East Meadow High School earlier this month echoed concerns of families about to pay college bills. Many said they'd hoped to pay for their children's college, but now they're telling their kids to take out loans, take on work-study or get a job for a year after high school.
Vijay and Sejal Gera say they've saved as much as possible to help their daughter. Monisha wants to study business or education and hopes for the "full college experience," including living in a dorm. She's been accepted to Adelphi, which charges about $38,000 for tuition, room and board.
That would have been possible a year ago, the Geras say, but recently Vijay had to take a 5 percent pay cut in his job as a computer programmer for an auto finance company.
The house they bought for about $430,000 has lost so much value they have abandoned plans for refinancing.
So they're compromising: They've suggested Monisha live on campus the first year, then commute the next three.
On the other hand, Bob Finnegan, a truck driver, is determined to allow his son Billy, 17, to follow his dream of studying at the University of Pittsburgh. Cost: $35,000 a year.
Because of the slow economy, Finnegan lost $10,000 in overtime last year. His wife works part time and they have another child who will be applying to college in four years.
"We're like a lot of Long Islanders: we pay for stuff as we go along," Finnegan said. "We'll pay for college the same way we paid for braces and musical instruments - by the seat of our pants."
CHARTING THE RISE IN APPLICATIONS AT FARMINGDALE STATE COLLEGE:
The lower cost of state colleges is a major factor driving their spike in applications. At Farmingdale, for example, tuition and fees for 2009-10 is $6,030, compared to the $26,273 national average cost for private colleges and universities.
Percent increase 2000-2009: 78.7 percent