designblox.com US College Loan Program Needs Changes | EdTechPost
06252014Headline:

Lawmakers say loan changes tough on black students

WASHINGTON (AP) — Black lawmakers on Tuesday urged President Barack Obama to do something about changes to a college loan program that they say make it tougher for students at historically black schools to finance their education.

Members of the Congressional Black Caucus met with the president and later said the PLUS loan was the first topic they discussed. Rep. Marcia Fudge, D-Ohio, the chair of the black caucus, said Obama assured them that he would address their concerns for students at historically black colleges and universities, or HBCUs.

“He knows it’s a major issue and how it has affected not only HBCUs but children of poor parents or who live in poor communities more than any other group of people. So he’s very clear and aware of what the issue is and he’s very receptive in trying to get a solution to the problem,” Fudge said.

Fudge said she expects to hear from the Education Department on the matter in about a week.

Lawmakers from the caucus said large numbers of previously eligible applicants are being denied PLUS loans under new Education Department credit check guidelines. Parents and graduate students who use PLUS loans have no borrowing limit, but receive some of the highest interest rates offered in the federal system.

The changes, which took effect in fall 2011, allowed the Education Department to consider delinquencies older than 90 days in determining credit worthiness.

Rep. James Clyburn, D-S.C., said the president was very receptive to the issue that has affected so many families. “We are all concerned about that. I’ve had schools in my district that have loss 500 students,” he said.

The Education Department points out that students whose parents are denied PLUS loans automatically become eligible for an extra $4,000 in loans that are more flexible and carry lower interest rates. In time for this academic year, the department has also started to send regular reports to affected parents and schools showing how applicants can have their credit check reconsidered.

According to the United Negro College Fund, 28,000 students attending historically black colleges and 400,000 students nationwide were initially denied PLUS loans.
Source: AP.ORG

 

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