“It’s been devastating,” said Rep. Corrine Brown (D-Fla.) a member of the Congressional Black Caucus. “The loan helped bridge the gap. For students and colleges that didn’t have additional resources, those students had to go home. And to me, that’s just unacceptable.”
The loans are known as PLUS loans and are available to parents of dependent undergraduate students, as well as graduate students. But a change in 2011 disqualified borrowers with unpaid debts over the past five years that had been referred to collection agencies or ruled as uncollectable.
Parents of nearly 15,000 students were denied PLUS loans as of last fall, with only 1,900 cases reversed on appeal, according to the National Association for Equal Opportunity in Higher Education, an umbrella organization for black colleges known as NAFEO. The loan issue was a major topic at a recent association conference in Washington.
Denied PLUS loans
Brown said figures provided to her by the Department of Education show that as of February, parents of about 28,000 students at historically black colleges had been denied PLUS loans. Among all schools and students, 400,000 PLUS loan applications were denied as a result of the stiffer credit criteria, according to Brown.
Education Department spokesman Daren Briscoe declined to provide specific numbers. But he said about 80 percent of the students who were denied the PLUS loans ended up enrolling in school anyway. He said the department contacted thousands of borrowers who were denied the loans and reconsidered some cases.
Among the historically black colleges, North Carolina Central University in Durham had 609 denials of PLUS loans, the largest amount, according to data from NAFEO.
The group reported loan denials at other schools, including 607 at Howard University in Washington; 569 at Florida A&M University in Tallahassee; 528 at Prairie View A&M University in Texas; 448 at South Carolina State University in Columbia; 407 at North Carolina A&T University in Greensboro; 260 at Shaw University in Raleigh, N.C.; 130 at Kentucky State University in Frankfort; and 66 at Fayetteville State University in Fayetteville, N.C.
At South Carolina State, where more than half of the students come from families earning less than $30,000 annually, enrollment dropped by about 700 students since last year, largely because of the stricter requirements, said Eric Eaton, assistant vice president for finance.
“What I personally see a lot of, at the beginning and end of the semester, more students are coming to me directly, trying to determine if the university has resources they can tap into,” he said.