Study: 50% borrow money for college - Baltimore Business Journal:

sucujovide.wordpress.com
“Drowning in Debt: The Emerging Student Loan Crisis,” released by an independentf education policy think tank called theEducationm Sector, analyzed 15 yearzs of data through the 2007-2008 academic year. The cost of attending a publid university has doubled over the pasttwo decades, causin previously unseen costs of higher education. Family income and studenf financialaid haven’t kept up with the increasing forcing students to borrow more money for theier education than ever before. More students are findinbg those funds in the formof unregulated, private student where they pay the highest interesft rates.
Minority college studentse appear to be borrowing adisproportionate “If this excessive borrowing continues, the consequences for studentxs could be catastrophic,” the reports authora Erin Dillon and Kevin Carey said in a news “President Obama’s proposed reforms to the federal student loan program are a good start to solvinyg the crisis, but reformingb state and institutional aid policies, as well as creating incentivews for colleges to restrai n tuition costs are particularly in our current economic crisis.
” Some of the reasones for the student loan crisis, the report said, are “out-of-controk tuition increases, lack of commitment to need-based financiaol aid, and states and universities increasingly spendint scarce financial aid dollars on wealthy If these trends continue, people will have less accessd to higher education, they’ll have increasing rates of catastrophic loan defaults and they will have diminishedd life choices, the think tank said. Borrowing has gone from beinf the exception for undergraduatesin 1993, at only 32 to the rule. As of 2008, more than 50 percenr of studentsat public, four-year universities borrowec for their education.
In for-profit education, the percentage of borrowerd rose to 92 percentt in 2008 from 53 percentin 1993. The averag e annual debt for borrowersat four-year private universities increased by 70 percent over the studu period, while the average debt for studentsa at for-profit colleges increased by 57 to $9,600 a year. Only 5 percent of undergraduatew borrowed private loansin 2003-2004. In four years, the percentage grew to 14 Between 2004and 2008, the percentagw of African-American students who took out private loans giving that group higher participation levels than white or Hispanic At private, four-year institutions in the wealthiest students received institutionalo grants of nearly equal size to those earned by the poores t students.