Education Commons^™

Experimental Evidence On Consumption, Saving, And Family Formation Responses To Student Debt Forgiveness, Jason Jabarri, Stephen Roll, Mathieu Despard, Leah Hamilton

Social Policy Institute Research

As policy-makers grapple with whether or not to forgive student debt, for who, and how much, it is important to explore how student debt forgiveness would relate to intended household decisions and behaviors. We conducted a survey experiment that asked participants with student debt to imagine a scenario in which the federal government forgave a certain amount of student debt. We then had these participants report on how this would affect their decisions and behaviors. 1,053 participants were randomly assigned to one of four conditions that offered $5,000, $10,000, $20,000, and complete debt forgiveness. Our results indicate that student debt …

Investing In Education: Impact Of Student Financial Stress On Self-Reported Health, Stephen Poplaski, Randy Kemnitz, Cliff A. Robb

Journal of Student Financial Aid

Through the lens of Human Capital theory, the role of financial aid (both amount and type) is explored in the context of student financial stress, and ultimately general student health. Data are taken from a sample of 232 students from a major Midwestern university who were surveyed about their financial attitudes, behavior and knowledge. The presence and amount of federal loans was associated with self-reported financial stress, and the validated stress measure was further associated with students’ self-reported health. A number of personal life events (i.e. job loss) were also associated with higher stress levels. Implications are discussed.

An Economic Analysis Of Student Loan Default, Arianna Castonguay

Electronic Theses and Dissertations

Cumulative student loan debt in the United States has now surpassed $1.5 trillion. Moreover, since the turn of the century, cohort default rates of these loans have steadily risen across all types of institutions. The latest data from the U.S. Department of Education shows 10.8 percent of borrowers who entered repayment in fiscal year 2015 have defaulted within three years. In turn, the first chapter of this paper summarizes student loan policies as well as trends in debt and default. Furthermore, it highlights the consequences of high student debt and default for individual borrowers and the economy. Results show evidence …

Graduate And Professional School Debt: How Much Students Borrow, Sandy Baum, Patricia Steele

Commissioned Research

There is wide variation in how students cover tuition and living expenses while they pursue graduate and professional degrees. Most research doctoral degree students attending public and private nonprofit schools benefit from generous institutional fellowships and assistant ships that cover a significant portion of their expenses. But master’s degree students in all sectors cover most of their expenses with earnings from employment and federal student loans. Borrowing is particularly important for professional degree students, most of whom have neither earnings from employment during the academic year nor grants and fellowships to cover tuition and living expenses while they are enrolled. …

Financing Graduate And Professional Education: How Students Pay, Sandy Baum, Patricia Steele

Commissioned Research

This brief examines how students finance their graduate and professional education. It summarizes the sources of funds used to cover the tuition and fees universities charge, as well as living expenses. Institutions set a “cost of attendance” (COA) for students, estimating the average budget for one academic year (fall through spring). COA includes tuition and fees, books and supplies, room and board, transportation, and other living expenses, and it establishes the maximum amount students can borrow in federal student loans to attend a particular school. These official budgets serve as the foundation for the discussion that follows about how graduate …

A Trillion-Dollar Question: What Predicts Student Loan Delinquencies?, Alvaro Mezza, Kamila Sommer

Journal of Student Financial Aid

The recent significant increase in student loan delinquencies has generated interest in understanding the key factors predicting the non-performance of these loans. However, despite the large size of the student loan market, existing analyses have been limited by lack of data. This paper studies predictors of student loan delinquencies using a nationally representative panel data set that anonymously combines individual credit bureau records with Federal Pell Grant and federal student loan recipient information, records on college enrollment, graduation and major, and school characteristics. We show that borrower-level credit characteristics are important predictors of student loan delinquencies. In particular, credit scores …

Do You Know What You Owe? Students' Understanding Of Their Student Loans, Emily A. Andruska, Jeanne M. Hogarth, Cynthia Needles Fletcher, Gregory R. Forbes, Darin R. Wohlgemuth

Cynthia Fletcher

Using a data set that augments a student survey with administrative data from the Iowa State University Office of Financial Aid, the authors posed two questions: Do students know whether they have student loans? Do students know how much they owe on outstanding student loans? We used logistic and ordered logit regressions to answer these questions. Results suggest that although the majority of students are aware that they owe on student loans, many underestimate the amount they owe. One eighth of students in the current study reported no student debt when, in fact, they had a loan. Over a quarter …

Loan Counseling For Graduate And Professional Students, Patricia Steele, Chad Anderson

Commissioned Research

This report provides an overview of existing literature that examines loan counseling and financial literacy for graduate and professional students, and includes actionable recommendations for stakeholders to better support students in making optimal financial decisions about their loans and other aspects of their personal finances. The report was authored by Patricia Steele, Ph.D., and Chad Anderson with Higher Ed Insight.

Income-Driven Repayment And The Public Financing Of Higher Education, John R. Brooks

Georgetown Law Faculty Publications and Other Works

This article provides the first comprehensive analysis in the legal literature of the federal government’s new income-driven student loan repayment programs, known as Income-Based Repayment and Pay As You Earn. In a set of gradual and little-noticed statutory and regulatory moves, the federal government, through these programs, has dramatically reshaped higher education finance in ways that schools, students, and even the government itself are only beginning to understand.

Under IBR and PAYE, a student borrower pays no more than 10% of her discretionary income in loan service payments, and after a maximum of 20 years, the remaining debt is forgiven—for …

Process And Net Impact Evaluations Of The Focus: Hope Adult Training Programs And Student Loan Fund, Kevin Hollenbeck

Kevin Hollenbeck

No abstract provided.

Focus:Hope: Using Unsecured Student Loans To Self-Finance Job Training For Disadvantaged Workers, Kevin Hollenbeck, Kelly Derango

Kevin Hollenbeck

No abstract provided.

Do You Know What You Owe? Students' Understanding Of Their Student Loans, Emily A. Andruska, Jeanne M. Hogarth, Cynthia Needles Fletcher, Gregory R. Forbes, Darin R. Wohlgemuth

Journal of Student Financial Aid

Using a data set that augments a student survey with administrative data from the Iowa State University Office of Financial Aid, the authors posed two questions: Do students know whether they have student loans? Do students know how much they owe on outstanding student loans? We used logistic and ordered logit regressions to answer these questions. Results suggest that although the majority of students are aware that they owe on student loans, many underestimate the amount they owe. One eighth of students in the current study reported no student debt when, in fact, they had a loan. Over a quarter …

The Presumption Of Payment, Christopher J. Dellana

SURGE

At Gettysburg College, students invest a considerable amount of money to make their experiences rewarding for future aspirations. Enrollment at this school, like others, I am sure, seems to breed a special type of student: the students who view themselves as paying and therefore deserving consumers. [excerpt]