Higher Ed Roundup: Week of March 3 – March 7

Cuomo Targets Sallie Mae Again

Truth in Tuition Advances in Maryland

Cuomo Targets Sallie Mae Again

New York Attorney General Andrew Cuomo is once again investigating student loan practices at Sallie Mae — this time targeting a private loan product that the company markets directly to students and their families. The student loan giant confirmed last week that it had received a subpoena from Cuomo’s office on Feb. 11 asking for more details about its Tuition Answer Loan program. Sallie Mae is just the latest loan provider to be caught up into Cuomo’s probe into the marketing of direct-to-consumer private loans. In October, his office issued subpoenas to 33 private-loan providers, including Nelnet, JPMorgan Chase, and Student Loan Xpress. At the time, he accused lenders of engaging in “misleading and deceptive tactics to entice young borrowers seeking college loans.”

This is not the first time Sallie Mae has drawn unwanted scrutiny over these loans. Last fall, Higher Ed Watch revealed that the lender had filed Freedom of Information Act requests in several states demanding public college systems to provide contact information on their students so that the company could market private loans directly to them. Soon after our item appeared, the company backed off its demands. Also in the fall, we discovered that Sallie Mae was placing ads on Google for “Private Loans — No FAFSA,” a move that ran contrary to the company’s pledge to encourage students to exhaust their federal loan eligibility before taking out more costly private loans

Truth in Tuition Advances in Maryland

Four years after it was first enacted in Illinois, Maryland lawmakers are now considering adopting their own Truth in Tuition plan. Maryland Delegate Heather Mizeur has introduced legislation in the state house that would allow students at the state’s public universities to lock in a four-year tuition plan. Truth in Tuition plans, which the New America Foundation favors, are gaining steam at statehouses and colleges across the country, including George Washington University and the University of Minnesota. A recent poll found that 77 percent of Maryland residents support the idea. Mizeur, who likens her proposal to a fixed-rate mortgage, says the certainty will help ensure that more students finish college.