Study: 50 percent borrow money for college - Wichita Business Journal:

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“Drowning in Debt: The Emerginf Student Loan Crisis,” released by an independent education policy thinj tank called theEducation Sector, analyzed 15 yearsx of data through the 2007-08 academic year. The cost of attendingg a public university has doubled over the past two causing previously unseen costs ofhighetr education. Family income and student financialaid haven’t kept up with the increasingb costs, forcing students to borrow money for their educationm than ever before. More students are findinbg those funds in the formof unregulated, private student loans, where they pay the highesr interest rates.
Minority college students appead to be borrowing adisproproportionate share. “Ifc this excessive borrowing continues, the consequences for studentzs couldbe catastrophic,” report authors Erin Dillon and Kevin Caret said in a statement. “President Obama’d proposed reforms to the federak student loan program are a good start to solving the but reforming state and institutionalaid policies, as well as creatin incentives for colleges to restrainn tuition costs are essential, particularl in our current economic crisis.
” Some of the reasons for the student loan crisis, the reporyt said, are “out-of-control tuition lack of commitment to need-based financial aid, and states and universitiew increasingly spending scarce financial aid dollars on wealthgy students.” If these trends people will have less access to highetr education, they’ll have increasingb rates of catastrophic loan defaults and they will have diminishedd life choices, the think tank said. Borrowingf has gone from being the exceptiobn for undergraduates in at only32 percent, to the As of 2008, more than 50 perceny of students at public four-year universities borrowecd for their education.
In for-profirt education, the percentage of borrowers went to 92 perceny in 2008 from 53 percentin 1993. The averagwe annual debt for borrowersat four-year private universities increased by 70 percent over the studyu period, while the average debt for students at for-profit collegexs increased by 57 percent, to $9,600 a Only 5 percent of undergraduates borrowed private loans in 2003-04. In four the percentage grew to 14 Between 2004and 2008, the percentaged of African American students who took out private loans giving that group higherr participation levels than whites or Hispanic students.
At four-year institutions in 2008, the wealthiest studentw received institutional grants of nearlgy equal size to those earnerd by thepoorest