In the world of university financial aid, Harvard is finding itself increasingly lonely at the top.

Stanford University announced sweeping changes to its aid policies last week, including a pledge not to reduce grants when students find outside scholarships.

The changes make Stanford the third high-ranking university in a month--following Princeton and Yale--to announce generous new policies aimed at attracting students from the middle class.

Harvard, still adhering to an older aid system, has responded to these sweeping changes with official silence and an informal promise to keep its aid offers "within shouting distance" of those from competing schools.

However, no similar pledges have been made regarding aid to today's undergraduates, even as Yale and Stanford prepare to offer thousands of dollars more to current students.

Following roughly similar announcements by Princeton and Yale in the last three weeks, Stanford's changes leave Harvard and Duke as the only universities in U.S. News & World Report's top five still using a traditional--but often less generous--system.

Stanford's plan, which like Yale's will affect the entire student body, allow students who receive outside scholarships to use these awards to eliminate the work-study and loan provisions of their aid package--a first.

Previously at Stanford, outside scholarships would reduce the amount of direct grant aid from the university.

"We wanted a good way to recognize student efforts, an alternative to borrowing," said Cynthia A. Rife, director of student awards in Stanford's financial aid office.

Stanford officials say the changes are expected to mean much less loan debt for the average middle-class student.

"I would tell any undergraduate student out there to sit down and look for these scholarships because now you'll really benefit," Margaret Brandeau, a Stanford engineering professor and head of the committee that recommended the changes, told The Stanford Daily last Wednesday.

Under the new system, Stanford will also limit the amount of family assets used in calculating need.

The portion of home equity--an estimate of home value added to income and savings in calculating a family's expected contribution--that cedes three times a family's annual income will be ignored in aid calculation.

The lower estimate of a family's ability to pay could mean thousands of dollars in aid previously unavailable for some students.

Stanford officials say this provision was designed to attract middle-class families with much of their money invested in their home, especially in California, where real estate values continue to soar.