As 2017 comes to a close, recaps of our eventful year are popping up in the media, social media feeds, and end-of-year reports. News stories have come and gone from our short-term memory, but the student loan debt crisis has perpetually remained top-of-mind. It won’t fade away anytime soon considering at least $1.3 trillion is owed by 44 million borrowers, according to a Forbes piece from February 2017.
The picture is particularly tough for minorities when digging deeper. “In 2013, 42 percent of African American families had student loans, compared to 28 percent of white families, according to the Urban Institute” (from a piece in The Atlantic).
The Brookings Institution reported in 2016 that “black borrowers remain more than three times as likely to default within four years as white borrowers (7.6 percent versus 2.4 percent). Hispanic borrowers, despite having about the same level of debt as white graduates, are more than twice as likely to default (5.7 percent).”
Repayment plans are available for loans offered through the federal government, but some borrowers aren’t always aware of them. However, short-term relief can turn into a long-term financial burden. To share an anecdote from my own experience, an income-based repayment plan sets a lower monthly payment than the 10-year standard repayment plan, but that prolongs the life of the loan and in turn the amount of interest paid.
Without question, students of all backgrounds face challenges in a landscape of rising costs of attendance and tightening budgets, but minority students are particularly impacted.
No need to make a prediction for 2018 – with certainty, the student loan debt crisis will remain top of mind for students and all of us who counsel them.
One last note: Now more than ever, scholarships are extremely valuable for students seeking funding for their education. The Charles L. Warren Memorial Heritage Scholarship is awarded by the Ohio Association for College Admission Counseling each year to outstanding high school seniors. The scholarship is a one-time $1,500 award, and eligible students may apply here: https://form.jotform.com/72675876761170. The deadline to apply is January 19, 2018.
Ryan Collins is an admission counselor at Baldwin Wallace University.