Without widespread student loan forgiveness, some colleges are adopting a new strategy to prevent students from drowning in debt.
About two dozen schools have adopted a “no-loan” policy, meaning they are eliminating student loans from their financial aid packages entirely.
“College is expensive — we need to make sure we keep it accessible,” said Nicole Hurd, president of Lafayette College in Easton, Pennsylvania.
In LafayetteFamilies with household incomes of up to $200,000 can meet their financial needs through grants and work-study without loans.
“We have a moral obligation to ensure that our low- and middle-income families know that a college education is the best investment you can make in yourself,” Hurd said.
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Colby College in Waterville, Maine, has had a no-loan policy in place since 2008.
For Terra Gallo, a student majoring in environmental policy, “Colby’s no-loan policy and the fact that demonstrated needs are met and addressed was something that was important to both me and my family.”
“I know a lot of people who are deeply in debt,” Gallo, 21, added. “That was something I didn’t want.”
Colby student Jackie Hardwick of Jacksonville, Florida, also said cost of attendance is the most important thing she considers when looking for colleges.
“That was the biggest concern for me,” she said, emphasizing Colby’s support for financial aid and Quest Bridge Scholars like herself.
Hardwick, 21, a global studies and East Asian studies double major, said she wouldn’t enroll at Colby without her scholarships or if she had a larger expected family contribution, which she said was still “pretty high.”
“For us, the no-loan message is incredibly powerful, especially when so many families are struggling with the very 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: taking on too much debt,” said Robert Franek, editor-in-chief of the Princeton Review and author of “The best 389 universities.”
“They say to students and parents, ‘I see you and I hear you.’”
Additionally, such programs are likely to encourage more students to apply, which can also increase a college’s return on investment – or the percentage of students who decide to enroll after admission – which is an important statistic for schools, Franek added.
“It’s a win-win for schools and students.”
“Typically you’ll see a pretty big increase in admission applications,” said Forrest Stuart, vice president of enrollment management at Lafayette.
“It makes your school better known,” he said. And “The more you get your name out there, the more robust we can put the class together.”
Of course, students may still need to cover the expected family contribution as well as other costs, including books and fees. Depending on the school, part-time studies may also be required.
Even if a school doesn’t provide a loan, that doesn’t stop a student or family from borrowing money to cover their contribution.
“No credit doesn’t mean we’re free,” noted Franek.
Hardwick, for example, works six part-time jobs on campus to support herself and her family.
“I have to help my family whenever I can,” she said.