Across the nation, nearly 1 million community college students in 32 states do not have access to federal student loans that could help them better afford the cost of college – a problem that leaves some turning to private student loans, working longer hours, or using credit cards to make ends meet, according to a new report.
The report – released today by the Institute for College Access & Success (TICAS) – found that nearly 1 in 10 community college students does not have access to federal student loans because their schools do not offer them. The report also documented disparities in access to student loans by race and ethnicity, state, and urban or non-urban status.
Overall, in eight states, more than 20 percent of community college students attend schools that do not participate in the federal student loan program, the report found.
Minority students and those in non-urban areas were also significantly more likely to attend schools that do not offer student loans. While just 8.3 percent of white students and 4.5 percent of Asian students lacked access to federal loans, 10.5 percent of Latino students, 12.7 percent of African American students, and 22.2 percent of Native American students attended community colleges that did not offer student loans, the report found. Those racial disparities were even more pronounced in certain states, such as Alabama, Montana, Tennessee, and Texas.
And students in non-urban areas were more than twice as likely than students in urban areas to attend schools that do not participate in the federal student loan program.
“The vast majority of full-time community college students need financial aid, and hardly any have their need fully met by grants – just 2 percent. Despite relatively low tuition and fees, community college students still face average total costs of $15,000,” said Debbie Cochrane, TICAS’ research director and co-author of the report, in a statement. “Federal loans can help students buy textbooks, pay for child care while they’re in class or studying, fix their car so they can get to school, or quit a second or third job to take more classes and increase their odds of graduating. Federal loans are the lowest-cost option for students who need to borrow to stay in school, but too many schools take that option off the table.”
The report notes that some schools do not participate in the federal student loan program because of concerns that high default rates will lead to negative consequences, but highlights some default management strategies at the community college level that could help ease those concerns and give students access to more financial aid. The report suggests, for example, that colleges tailor the student loan information they distribute to students, and get the entire campus involved in default management plans.
The report also makes several recommendations for how the Department of Education (ED) can ensure community college students have access to federal loans, and lower default rates. The report suggests, for example, that ED publish a college’s borrowing rate alongside its cohort default rate to help put those numbers in context, and note whether schools offer federal loans in consumer reporting tools so students know ahead of time whether they will have access.
“Federal loans can enable students to attend college full time, helping them succeed in school and repay their loans as a result,” said Laura Szabo-Kubitz, TICAS’ California project manager and report co-author, in a statement. “Offering federal loans is a natural fit with community colleges’ efforts to support student success.”
Publication Date: 6/29/2016