Though the news has been saturated with stories about college tuitions increasing, the private student loan industry collapsing and students graduating from college with enormous debt burdens, local high school guidance counselors say the full reality of college costs has not hit most students.

"I think the realization hasn't quite hit yet," said Monica Sawyer, a guidance counselor at Gilford High School. "We're going to hear a lot more about that in the spring when financial award letters go out."

Award letters are letters detailing the financial aid package — including scholarships, grants and loans that a school is offering student who has applied. Often the award does not cover the total cost.

Lori Jewett, guidance director at Gilford High School, said they begin talking to students about costs beginning in September.

"We talk to families in the fall and tell them to start thinking about what they are willing to do or what they can pay for higher education," Jewett said.

Both counselors said that when they first talk to students, many are under the misconception that they will be able to get scholarships to pay for their whole college education.

Jewett said that once in a while a student will get a full scholarship to a school, but the majority of students get scholarships that only cover a portion of the cost of their education.

"Or they think financial aid will take care of a bigger portion of the cost than it actually does," Sawyer said. "When they see what the gap really is between the aid (the school is offering) and the total cost, it's a reality check."

Jewett said the good news is that colleges are reacting to the current situation by offering more aid.

"More and more colleges are trying to meet the financial needs of students without loans," Jewett said. "They are reaching into their endowments (to offer more aid)."

Mary Maloney, guidance director at Franklin High School, said seniors applying to colleges this year are not altering their choices based on the economy just yet.

"This class is not daunted by the economy," Maloney said. "They are applying to where they most want to go and I think they are hoping for the best."

She said reality will set in the first half of 2009 when award letters from colleges and universities go out to students.

Maloney said the economy has negatively impacted some scholarship funds.

Over the last several years the total amount of local scholarship money available to students has decreased from $125,000 to $70,000. This is because some businesses who used to give money closed or moved from the area, Maloney said, and others, due to economic circumstances, have had to give less.

Maloney said she will not know how the latest economic events have affected scholarships funds until at least February, when organizations will contact the school and let them know how much money they will have available for students this year.

As a result of dwindling scholarship funds, Maloney said they are being more proactive when it comes to ferreting out new grant and scholarship opportunities for their students.

She said a new guidance counselor at the school researches scholarships and grants and presents the information to senior classes.

Tara Payne, spokeswoman for the New Hampshire Higher Education Assistance Foundation (or NHHEAF), said she will not have concrete data on how the current economy is affecting college financing until next spring.

Anecdotally, Payne said she has noticed an increase in interest in community colleges.

"More students than ever before are coming to us and asking about community colleges or going to school part-time," Payne said.

She said many students are planning to attend a community college with the intent of going on to a four-year school.

Others have mentioned taking a year or two off from school so they can work and save money so they won't have to borrow as much.

Payne said some families who had established a college fund for their child or children have seen those funds diminish and the stock market plummet.

Those families who planned to pay for a college education through a home-equity loan may now no longer have that option due to decreased home values.

In March, NHHEAF had to suspend its private or alternative student loan program, Payne said.

The organization still offers federally guaranteed student and parent loan programs, unlike some 28 nonprofit organizations across the country who have had to suspend or exit their federal student loan programs, Payne said.

According to the website FinAid.com, a free source of financial aid information managed by author Mark Kantrowitz, as of November 168 lenders nationwide have either exited or suspended their participation in all or part of the federally-guaranteed student loan program and a total of 38 lenders have suspended private student loans.

Kantrowitz, who is based in Cranberry Township, Penn. has written four books on financial aid and college planning, including his most recent, FastWeb College Gold, which was published by Harper Collins in September 2006.

Yet a majority of students are not altering their college plans because of cost, Payne said.

"In general, students still feel hopeful that they can go to the college of their dreams," Payne said.

Payne said when they talk to students and families they have been emphasizing the importance of applying to "financial safety schools" along with other choices. A financial safety school is one that the student and/or parents will definitely be able to afford if the student does not get enough aid to attend their top choice school.

But, Payne said, students should not be discouraged from applying to expensive schools.

"Just because it's a high sticker price doesn't mean it is unaffordable because some of these schools have excellent financial aid packages," Payne said.

Sue Jacobs, financial aid director at Lakes Region Community College, said the school has not seen an increase in enrollment yet but she expects the numbers will go up over the next couple years.

"The Community College System is not in dire straights like more expensive schools," Jacobs said. "We're affordable to most families and we've got that transferability factor."

Jacobs said that the collapse of the private educational loan industry has impacted students attending or planning to attend Lakes Region Community College because the costs can easily be met by federal student and parent loans and other aid such as scholarships or grants.

She added that President George W. Bush signed a law in May that increased the amount students and families can get each year through federal loan programs.

The cost of in-state tuition at any of the state's community colleges is between $5,500 to $6,500, which is approximately half the cost of tuition at any of the three state universities, Jacobs said.

June Schlabach, financial aid director at Plymouth State University, said they will have a better idea of how the economy is affecting students' ability to pay for education in the spring, when financial award offers are sent for the 2009-10 academic year.

Schlabach said families who had already taken out private students loans for the current academic year will not feel the fallout of the collapse of the private student loan market until next year, when they go to apply for another loan.

Schlabach said her office is willing to work with students and families who are experiencing difficulties, such as sudden job loss, to adjust their financial aid package.

Jewett said that while many current college-bound students don't appear to be concerned about cost, she predicts it will become a bigger priority as the economy worsens.

"When the economy is bad, enrollment is community colleges goes up and I think within the next two years we see that happening," Jewett said, adding that it is a good steppingstone to achieving a four-year degree, especially since the Community College System of New Hampshire has worked hard to make its two-year programs compatible and credit transferable to the schools in the State College System.

"Some students are beginning to think outside the box of going to a four-year school right out of high school," Sawyer agreed.

DARYL CARLSON/CITIZEN PHOTO Gilford High School Councilors Lori Jewitt, left, and Monica Sawyer discuss the realities of paying for college in this current economic downturn * Order a print of this photo