Chronicle of Higher Ed: Black Graduates Owe More Debt

Paying for College
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<p>Black</a> Graduates Owe More Debt Than White, Asian, or Hispanic Graduates - Students - The Chronicle of Higher Education</p>

<p>An interesting, if brief, article that concerns more than what the title states.</p>

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Many students graduate with manageable debt or no education loans, but almost 17 percent of graduates in 2008 borrowed $30,500 or more to get their bachelor's degrees, according to a new analysis.</p>

<p>A report released today by the College Board Advocacy & Policy Center, also said that students who borrow the most are disproportionately black, and are more likely to have attended a private nonprofit or for-profit college than a public four-year college. But debt levels did not necessarily reflect family income.

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"It's not the lowest-income students who are most likely to have debt," Ms. Baum said. "It's actually middle-income students who are slightly more likely than others to have high levels of debt."</p>

<p>She said, however, that it would be difficult to pinpoint exactly why that is so. Several factors, including the types of institutions that students from middle-income families choose to attend, could contribute to their higher debt.

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Thirty-eight percent of students from public four-year colleges graduated without student-loan debt, compared with 28 percent from private nonprofit colleges, and only 4 percent from commercial institutions.</p>

<p>Those from the commercial, or for-profit, institutions were more than twice as likely to have $30,500 or more in loan debt when compared with their peers from private four-year colleges and more than four times as likely to have that level of debt than their counterparts from public four-year institutions. About 53 percent of for-profit graduates had that high a debt load, versus 24 percent of those from private, nonprofit four-year colleges and 12 percent from public four-year colleges.

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<p>Thoughts? The findings about middle-income students were interesting, if only for the reason that the person quoted seemed to suggest that people didn't know that stuff already.</p>

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<p>*“It’s actually middle-income students who are slightly more likely than others to have high levels of debt.”</p>

<p>She said, however, that it would be difficult to pinpoint exactly why that is so. Several factors,** including the types of institutions that students from middle-income families choose to attend, **could contribute to their higher debt. *</p>

<p>That’s exactly the factor that first came to mind while reading this article. I can see in my own neighborhood (which is about 1/4-1/3 African American). Many of the students are going to great schools, but are taking on big debt to attend. These are upper-middle class kids who fall into the same problem as upper middle-class whites…high EFCs and parents can’t afford to pay.</p>

<p>What I don’t see is many pursuing merit money from schools known to offer for their strong stats. Don’t know why that is.</p>

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<p>That’s not surprising considering the average income and number of people living in a black household… Most of the time, they’re going to graduate with more debt. </p>

<p>I agree with what mom2 said as well. A lot of my black classmates (I’m black too) are choosing to go to places I would have never considered because of the cost.</p>

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<p>This explains a lot, which is why I’m cautious on whether or not I’ll attend top private schools if I get accepted.</p>

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<p>I bet if the middle class family lived a lowerclass lifestyle they wouldnt need to have as much debt.</p>

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<p>I have to agree with mom2collegekids. I’m not sure what numbers of low-income students attend top schools, but schools with hefty financial aid packages sometimes offer no-loans to low-income students and some loans to middle-income students. Loans are generally - of course, not always - more toxic for low-income students. Additionally, low-income students are often more painfully aware of what debt is. Very few low-income students would consider $100,000+ debt to go to a middle or upper college, whereas middle-income students tend to actually contemplate this (despite other options!).</p>

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<p>I don’t know about middle-class kids since I came from a low-income family and was the first in my family to go to college, but I honestly didn’t know anything about colleges until halfway through high school. I didn’t have the Internet so research was tough. Of course, I was lucky enough not to know about US News & World Report either, so at least I didn’t have that pitfall waiting for me! ;D</p>

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<p>This article is very overdue. Too many people think URMs are low-income. There are many middle and upper-middle class URMs who are admitted into great schools but are expected to afford the costly tuition.</p>

<p>What is so disappointing about this trend is that middle-class URM families on average have LESS savings and financial mobility than their white counterparts.</p>

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<p>I also forgot to mention that the current financial aid system favors the very poor, the very smart, or the very rich (income > $250,000). If you don’t fall in those categories, you are totally screwed.</p>

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<p>OMGfacepalm.</p>

<p>The super-poor-get-great-FA myth has been debunked plenty of times.</p>

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<p>^^^</p>

<p>Right. The super poor only get great aid if they live in the right states and can get into the right schools and/or have the stats to get into ivies.</p>

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<p>Which is pretty much like saying that you have great financial aid if you win the lottery after killing your rich uncle from Hoboken and changing his will to leave his vast fortune to you. Sure, if you fall into that ridiculously tiny category, life is pretty great. However, getting into Harvard, Yale, or Princeton isn’t a realistic expectation for any one and if that resembles a major part of your financial aid strategy then there might be a little trouble in the future.</p>

<p>(Oh, and just to be clear; the lottery / murdering your uncle thing isn’t really a sure thing either).</p>

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<p>This, I believe is the actual study
<a href=“College Board Foundation | Home”>College Board Foundation | Home;

<p>It concludes that independent students are more likely to have high debt as are those at for profit institutions, suggests that debt is not directly correlated to income and that blacks are more likely to have high debt than other racial/ethnic groups.</p>

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<p>*Right. The super poor only get great aid if they live in the right states and can get into the right schools and/or have the stats to get into ivies.</p>

<p>Which is pretty much like saying that you have great financial aid if you win the lottery after killing your rich uncle from Hoboken and changing his will to leave his vast fortune to you. Sure, if you fall into that ridiculously tiny category, life is pretty great.*</p>

<p>Exactly…the exceptions, not the rule.</p>

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<p>I’m not surprised at those results, especially the independent students bit. Independent students are eligible for higher loan amounts at the start, so it would make sense for them to have higher debt loads than dependent students by virtue of being allowed to borrow more. </p>

<p>Does anyone know the inside scoop about the average tuition or fees for for-profit universities, and their graduate rates for 4- 5- or 6 years?</p>

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<p>My comment is not directed toward any ethnic group. I don’t know why financial institutions lend students in excess of $30,500.00 toward college. I would like to see the percentage of people who actually pay all of the loans back. My guess is a very small percentage. You are setting the average person up for failure by allowing him to get so far in debt.</p>

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<p>Well, it’s not dischargeable in bankruptcy, right? I think that might increase pay back rates because you can’t get rid of it as “easily” as other debt.</p>

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<p>17% of all students have debt over 30.5K and those figures are probably a couple of years old. With the expansion of stafford limits 2 years ago we’re probably looking at much higher numbers in the next couple of years.</p>

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<p>I wish policy makers would realize how bad this is for the future of our economy and country as a whole. Why can’t see anybody see how bad this will end up?</p>

<p>Then again I saw the whole housing collapse years before it happened…</p>

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<p>But here’s the difference - you can walk away from a bad mortgage and start over - you can’t walk away from a college loan - no bankruptcy protection. The banks and the government are covered it’s the kids that take the hit.</p>