- Following the fight over student loan forgiveness, a growing number of colleges are eliminating education debt from the start.
- About two dozen schools now have “no credit” policies; This means they will cover 100% of an undergraduate student’s financial aid needs with grants rather than student loans.
Without broad-based student loan forgiveness, some colleges have a new strategy to save their students from drowning in debt.
Nearly two dozen schools have implemented “no credit” policies; This means they completely exclude student loans from their financial aid packages.
“College is expensive; we have to make sure we keep it accessible,” said Nicole Hurd, president of Lafayette College in Easton, Pennsylvania.
in LafayetteThe financial needs of families with household incomes up to $200,000 are met through grants and work efforts without any loans.
“We have a moral obligation to make sure our low- and middle-income families know that college is the best investment you can make in yourself,” Hurd said.
More from Personal Finance:
More colleges offer guaranteed admission
Strategy could cut thousands in college costs
Should you apply to university early?
Colby College in Waterville, Maine, has had a no-credit policy since 2008.
According to Terra Gallo, a senior majoring in environmental policy, “Colby’s no-credit policy and meeting and accounting for emerging needs was something that was important to both me and my family.”
“I know a lot of people who have significant amounts of debt,” Gallo, 21, added. “This was something I didn’t want.”
Colby senior Jackie Hardwick of Jacksonville, Florida, also said the most important thing she considers when looking at colleges is the cost of attendance.
“That was the No. 1 concern on my mind,” he said, highlighting Colby’s support for financial aid and Quest Bridge scholarship recipients like himself.
Hardwick, 21, a global studies and East Asian studies double major, said she wouldn’t have enrolled at Colby without the scholarships or the larger family contribution expected of her, which she said is still “pretty loaded.”
“For us, the no-credit message is incredibly powerful, especially as so many families are struggling with real concerns about the cost of higher education,” said Randi Maloney, Colby’s dean of admissions and financial aid.
“These schools have addressed the biggest concern of students and parents, the problem of taking on too much debt,” said Robert Franek, editor-in-chief of The Princeton Review and author of “Top 389 Colleges“
“They tell students and parents, ‘I see you, I hear you.'”
Additionally, such programs are likely to result in more students applying, which can increase a university’s efficiency – or The percentage of students who choose to enroll after being accepted is also an important statistic for schools, Franek added.
These schools have solved the problem of taking on too much debt, which was the biggest concern of students and parents.
Robert Franek
editor-in-chief of The Princeton Review
“It’s a win-win for schools and students.”
“Typically you’ll see a pretty big increase in the number of admissions applications,” said Forrest Stuart, Lafayette’s vice president of enrollment management.
“It puts your school on the map,” he said. And “the more your name is heard, the stronger a class we can create.”
Of course, students may still be on the hook for other expenses, including books and fees, as well as the expected family contribution. Depending on the school, there may also be a work-study requirement.
Even if a school has a no-loan policy, this does not prevent the student or family from borrowing to cover their own contributions.
“No credit does not mean free,” Franek said.
Hardwick, for example, works six part-time jobs on campus to support his and his family’s expected contribution.
“I have to help my family as much as possible,” he said.
