Roundup: News You Need to Know, Fri., Dec. 1st

Maverick Lender Criticizes Colleges for Denying Students Access to Low-Cost Student Loans

Raza Khan, president and co-founder of the student loan company MyRichUncle, accused financial aid administrators and lenders at a Consumer Bankers Association conference of blocking students from receiving the lowest-cost loans. In a news release and a panel discussion on ethics, Khan criticized financial aid administrators for developing exclusive relationships with certain lenders and failing to shop around for better financial deals for their students. According to MyRichUncle, some 1200 students ran into difficulties with their colleges in getting low interest MyRichUncle loans certified and many received loans only after the company complained. College financial aid respresentatives responded by saying that while there have been "some excesses," such as lenders offering inappropriate incentives to administrators, the "vast majority" of lenders and aid officers behave responsibly.

High School Graduates in Arkansas Not Well-Prepared for College

A survey by the Arkansas Department of Education found that students at Arkansas colleges are not well-prepared for college-level work. The survey questioned professors who teacher freshmen-level courses at 33 two-year and four-year institutions in Arkansas. The professors gave high schools very poor marks on college preparation: 60% graded the academic quality of public high schools as a "D" or "F," and 82% said their freshman students are "somewhat prepared" or "not very prepared" for college. In addition, 66% of the professors believed that more than half of the freshmen they teach need remedial instruction.

MOHELA Starts to Reserve Money for Gov. Blunts Proposed Construction Plan

The board of the Missouri Higher Education Loan Authority (MOHELA) voted unanimously to create a special account that will reserve money for Governor Matt Blunts plan to sell MOHELAs assets and finance campus building projects, even though the plan has yet to be debated or approved by the legislature. MOHELA already has started a bid process to sell off a portion of its student loans. Proceeds from those sales will be added to the special account. The account already contains $71 million, and the boards goal is to set aside $170 million by the end of January. The entire plan, however, is still contingent on the legislatures approval, and there has been much criticism of the plans details, particularly from Attorney General Jay Nixon.