Large numbers of students are leaving the nation's historically black colleges and universities because of a change in the federal education loan policy that created a gap in their financial aid, the The Washington Post reports.
The 2011 change to the Parent Plus loan program disqualified borrowers with unpaid debts over the past five years that had been referred to collections agencies or were uncollectable.
Since February, parents of about 28,000 students at historically black colleges and universities have been denied PLUS loans, the story said. Across all U.S. schools and students, the tougher credit rule has resulted in 400,000 PLUS loan denials. About 80 percent of U.S. students who lost out on the loans are able to attend college anyway, the story said. But, equal opportunity advocates are concerned because hundreds of students at black colleges have had to go home because they could no longer afford college.
Changes to the Parent Plus loan program came after criticisms that the loans were too easy to get, and too hard to get out of, a Chronicle of Higher Education story said. Although credit history is examined before the loans are issued, there is no income check, no employment check and no check on other debts such as mortgages, car loans or other student loans. And, Parent Plus loans can't be discharged through bankruptcy.