As the economy weakens and more workers are laid off, there is a growing need for financial aid from students that wouldn't have needed it before. According to The New York Times, most students won't have problems paying fall semester tuition because those arrangements were made months ago, but it's apparent the number of families needing aid is growing. Colleges are concerned there won't be enough aid money for everyone who applies and are keeping an eye on the economy, especially in terms of employment.
Seventy-five percent of student loans are in the form of federal aid and the number of these applications this year is already up 10 percent from last year. The credit crisis has forced many students, who had been borrowing on their own, to ask their parents to cosign on loans. Fidelity Investments released survey results earlier this month and found that 62 percent of parents are planning on using student loans in combination with their own contributions, while last year 53 percent said they'd be using loans to help with expenses.