Les Jones

News > Amherst College Eliminates Loans in Financial Aid Packages

The Amherst Student - Amherst cuts loans in college aid

“Our concern was that students who expect to have to take out large loans to come to Amherst were being scared away from applying or choosing not to attend Amherst if admitted,” said President Anthony Marx. “In addition, we were concerned that students who did choose to come to Amherst and took out significant loans were having their career choices constrained by debt.”

Scholarship resources derive from the College’s endowment, alumni gifts and operating budget. As its resources have expanded, the College has increasingly taken measures to make tuition more affordable for low-income families.

The College began reducing loans in the mid 1980s, and, in 1999, became the first college in the U.S. to abolish loans for low-income students. The policy was initially confined to students with family incomes under $40,000, but was extended to include incomes lower than $60,000 two years ago.

I'm of two minds about student loans. On the one hand, they enable students to go attend college who wouldn't otherwise be able to afford it. On the other hand, some students wind up saddled with big debts early in life, and often have degrees where the likely career prospects make repaying the loans difficult.

The U.S. government, in trying to help the former, is enabling the latter. Many people would object to Bank of America letting an 18 year old anthropology major take on tens of thousands of dollars a year in debt to finance their personal lives in college, but the government is making it possible for that same student to take on the same debt to pay for tuition. With the student loan the interest rate is lower, but you may not be able escape the debt with bankruptcy.

According to the article Princeton University and Davidson College have eliminated loans completely. I'm glad to see some colleges acknowledge the potentially disruptive effects of an education bought on credit and take action to minimize that danger. Too, many colleges are so well-endowed they can afford to significantly offset tuition costs rather than let students take out loans. A few colleges are so rich from alumni endowments that they should be ashamed to charge tuition.