<p>Penn announces new financial aid policy
By 2009, grants will replace loans in all aid packages</p>
<p>The University announced a new financial aid policy Dec. 17, launching an initiative that will eliminate loans from all undergraduate financial aid packages within two years.</p>
<p>Beginning in September 2008, undergraduate students with family incomes under $100,000 will receive loan-free packages, according to a University press release. By fall 2009, all undergraduates eligible for financial aid will receive loan-free packages, regardless of income level.</p>
<p>The policy will apply to all eligible undergraduate students, not just incoming freshmen.</p>
<p>Half of the about 4,000 Penn students who receive financial aid have a loan as part of their package. Under Penn's current policy, students with family incomes under $60,000 are eligible for loan-free financial aid packages.</p>
<p>"We have previously addressed the needs of low income and lower middle income families, but now must respond to the needs of our middle and upper middle income families, who are facing the highest levels of debt," Penn President Amy Gutmann said in the press release.</p>
<p>Penn's announcement comes the week after Harvard University and Swarthmore College both announced major financial aid policy changes, with both eliminating loans in all aid packages.</p>
<p>The new aid policy will be funded in large part through funds from the University's current $3.5 billion capital campaign, Gutmann said in the press release.</p>