Other HBCUs have employed their own strategies to reduce student debt. In 2015, Paul Quinn College implemented a work-study model.
In addition to institutions trying to lower college debt, the nonprofit United Negro College Fund reported that this year alone, it is providing nearly $100 million in scholarships to more than 7,200 students of color. Not every student wins a scholarship, though.
Loans are almost necessary without any scholarships, but students and their families have to shop around to find the best loans for them, said Brian Bridges, UNCF’s vice president of research and member engagement.
Parent PLUS Loans https://paydayloansohio.org/cities/lewisburg/ are an essential college financing option for some students and parents that can be improved; however, the program must be repaired, not repealed, Bridges added.
The program is doing a huge disservice to students of color and families of color when we’re saying that they can borrow however much they want, said Colleen Campbell, director for postsecondary education at the liberal think tank American Progress.
If a family can only contribute $5,000 to their student’s education in a year, Campbell said, that’s probably the amount you should allow them to borrow.
How to use parent loans safely
For families that have used the federal Direct PLUS Loans, or are considering the loan, experts offer advice about how to navigate the process and make decisions appropriate for their specific case.
This generational pattern of borrowing is not uncommon, since the Parent PLUS program casts debt across all generations not just young people affected by federal student loans
- Make sure you and your children are industrious about pursuing opportunities that are not loans before the student goes to school, including applying for other scholarship programs.
- If you have to use this tool to finance the education of the student, you are encouraged to have a conversation with the financial aid department at the institution and the counselor that you are offered to understand the terms of the agreement in advance
This generational pattern of borrowing is not uncommon, since the Parent PLUS program casts debt across all generations not just young people affected by federal student loans
- The only safety mechanism for this loan for low-income families is to consolidate the parent plus loan and get income-contingent payment
- Know that you can’t transfer the loan to students, it’s not a co-signing. You’re taking full responsibility for this debt.
- Be aware of how much you’re borrowing and ask, What are your repayment options?’
- Ask whether or not you can handle that burden, especially approaching retirement. Don’t assume you can repay the loan just because you get approved. The federal government can’t make that determination and it is not allowed to.
This generational pattern of borrowing is not uncommon, since the Parent PLUS program casts debt across all generations not just young people affected by federal student loans
- Talking to your loan servicer is very important. They have gotten a bad reputation over the last couple of years, but they’re really the only ones who can help you manage your loans. That is really important because otherwise, you’re not going to get help.
- Going to community college and transferring to a four-year college is a way to reduce costs. It is worthwhile if you know your goal institution is accepting of transfer students – that you are basically guaranteed that your credits are going to transfer.
This story was reported by Holly Barker, Noah Broder, Josephine Chu, Ebony Curry, Andre Earls, Apoorva Mittal, Lu Zhao and Priscilla Zhu. It was written by Ariana Puzzo and Kelly Rissman.
Frank Lawrence Jr., a Morehouse Alumni Association member and 2019 graduate whose debts were cleared by Smith’s gift, said the Alumni Association is trying to encourage more alumni to give back.
