Brown University announced Thursday that it will no longer provide loans, only grants, in an effort to help students graduate with less debt.
Starting in the fall of 2018, all students who receive financial aid from the Ivy League university will receive scholarships, which they don’t have to pay back.
The goal is to make the university more affordable and accessible, particularly to middle-income families, said Brown spokesman Brian Clark. The students who will most likely benefit are those who previously may not have qualified for the university’s grants to low-income students from families making less than $100,000 per year but still were not able to afford the school’s tuition of $67,000 per year with room and board. Some of those families would then take out loans to help cover the cost of attending the school.
Americans owe more than $1.3 trillion in student loans with the median borrower still owing $17,000 for their education in 2016, according to Pew Research. Young college graduates with loans are more likely to be juggling more than one job and to be struggling financially after graduation.
“It’s important that students who come to Brown are able to pursue fulfilling careers and not just make decisions based on grappling with debt after graduation,” Clark told HuffPost. “And when students are thinking about where to apply, the sticker price can dissuade them from even trying. We want them to know Brown is a choice for them.”
With this move, Brown joins about 15 to 20 four-year colleges and universities out of more than 3,000 nationwide that have a loan-free aid policy, including other Ivy League universities, such as Princeton and Yale.
More than 1,000 students are expected to benefit from the loan-free program next year.
While the program will help students graduate with less debt, the university can’t guarantee that all of its students will graduate debt-free, Clark noted. Families will still be able to take out private loans for instance, to finance a student’s books, personal expenses or costs of travel while studying abroad.
Before the change, the university had capped loans to students at $5,000 per year.
For one student, Nadir Pearson, who is a junior studying sociology, this policy will cut his loan burden for next year though he’ll still have thousands in debt from previous years, both from Brown and from private loans.
“I’m going to benefit from any money that they take off. It’s not everything, but it’s definitely something that can help, that I appreciate,” Pearson, who grew up in New Jersey, told HuffPost. He said his mother, the family’s breadwinner, usually earns just above $100,000 a year.
“The pressure is building as graduation comes. It’s a bittersweet moment: You’re excited to get into the new world, but you have a mountain of debt,” Pearson added. “I’m excited about new generations having less debt, who won’t have to worry about money as a factor.”
The pressure is building as graduation comes. It’s a bittersweet moment: You’re excited to get into the new world, but you have a mountain of debt. Nadir Pearson, a junior at Brown University
To fund the new policy, Brown will need an additional $4.5 million per year for its financial aid budget, according to Clark. The university started a $120 million fundraising campaign in September and by December had already raised its initial goal of $30 million, allowing it to kick off the program. The university is confident that it will reach its goal to be able to make loan-free aid a permanent policy, Clark said.
It’s worth noting that part of what enables Brown University and other Ivy Leagues to offer such generous financial aid packages are their big endowments which often number in the billions of dollars supplied by funds from donors.
“We’re doing everything we can here. Different schools are in different circumstances. It takes significant resources to be able to do this,” Clark told HuffPost. “But the more access and affordability there is across higher education, the better.”
Other recent efforts across the country have taken aim at student debt: A handful of states and cities including New York, Tennessee and San Francisco are now offering free community college.
“There’s definitely more that can be done. I don’t think anyone should be satisfied,” Pearson said of Brown’s loan-free aid policy. “Hopefully we will see less and less costs for education it’s something that everyone deserves.”
Read more: http://www.huffingtonpost.com/entry/brown-university-loan-free-financial-aid_us_5a29c60fe4b073789f687aa6