The U.S. Department of Education says it will unveil a shorter, less painful version of the FAFSA, the federal application for financial aid, in 2010-2011.

The college financial aid system is "in crisis," according to the head of the American Association of College Registrars and Admissions Officers. Barmak Nassirian: "Every one of the participants in the system is experiencing hardship — higher education institutions, states, aid donors and families all are cash-strapped."

National banks like JP Morgan Chase and Citibank are beginning to cut back loans, and in some cases, not provide loans to students who attend community and commercial colleges. Over 40 percent of undergrads in the U.S. are enrolled in a community college and Latinos are twice as likely to attend community college over a four-year college.