WASHINGTON — The Consumer Financial Protection Bureau is urging colleges to adopt a new form designed to make it easier for students to compare financial aid offers.
CFPB Director Richard Cordray touted the new form, which the consumer bureau designed in partnership with the U.S. Department of Education, during a Monday conference call with reporters.
"Too often students receive financial aid award letters that are laden with jargon, use inconsistent terms and calculations, and make it unnecessarily difficult to compare different financial aid awards side-by-side," Cordray said. "The form can help students understand how much debt they may have after graduation and what their monthly payment could look like."
Cordray said that universities representing more than a million students have agreed to use the form, which is being called the Financial Aid Shopping Sheet.
Senate Banking Committee Chairman Tim Johnson, D-S.D., praised the CFPB on Monday for developing the form.
"The Financial Aid Shopping Sheet is a real game changer for students and parents, and it is a perfect example of why we created the CFPB," Johnson said in a statement.
The form is being released at a time when the CFPB has been focusing attention on the nation's student loan debt, which it says recently passed the $1 trillion mark.
Last week, the CFPB and the Education Department released a report on private student loans that asked Congress to investigate whether a 2005 change to bankruptcy laws, which made it more difficult to discharge private student loans in bankruptcy, was having its intended effects.
Rohit Chopra, the CFPB's student loan ombudsman, is scheduled to testify about that report on Tuesday at a hearing of the Senate consumer protection subcommittee.