When acceptance letters went out for the class of 2012 earlier this week, Swarthmore did not ask a single student to take on loans. And next year, one third of Swarthmore’s population will receive much higher grants. Swarthmore has decided to do away with loans for students on financial aid.
“The decision was made this past weekend,” said College Vice President Maurice Eldridge ’61. “We didn’t go into the meeting expecting to make the decision, but it just happened. We leapfrogged our planning.”
It is a massive change to Swarthmore’s financial aid program. Dropping all loans will cost the College roughly $1.7 million every year, which amounts to a 8.5% increase in financial aid spending. The College currently spends $20 million every year on financial aid.
The last change of similar magnitude was in 1998, according to Dean of Admissions and Financial Aid Jim Bock ’90. It was then that the College made the Swarthmore Scholars program no-loan. This new decision is still unique in its sheer size. “There hasn’t been another change that has affected this many people,” said Bock.
The change will affect the 2/3 of the students receiving financial aid who currently receive loans—a total of nearly 500 students. On average, these students have loans of roughly $12,000 according to Bock.
“Our cap on loans is going from $15,000 to 0,” said Bock with a big smile.
It is not clear why the Board decided 2007 was the year to make the change, but it was probably a combination of pressure from other peer schools–Davidson, Amherst, and Williams all have gone no-loan in the past year, and Harvard went no-loan on Monday–and a strong feeling among Board members that the change was simply the right thing to do.
“We’ve always been one of the leaders in how we give out need-based aid,” explained Bock. Swarthmore will be the sixth college to have eliminated loans–Princeton was the first, followed by the four mentioned above.
Eldridge mirrored Bock’s comments. “The Board was motivated by its principles, and the fact that Swarthmore has always tried to be really accessible,” he said. “There is a perception that [Swarthmore] is impossible to afford or that debt is very scary.”
The ongoing planning process helped set the stage for the change, as the College is still engaged in the Middle States Review process.
The next big question is how to raise the estimated $40 million required to endow this change in perpetuity. Eldridge thought it would be a challenge, but noted that financial aid is a relatively easy program to raise money for.
“Among all the things the college raises funds for, financial aid is the most popular, along with faculty chairs,” he said.
After this monumental decision, where does Swarthmore go next? Bock is clear what his next target would be: “We aren’t need blind for internationals.” Still, he is heartened to know that the decision to go no-loan will have a big impact on current international students. “Few internationals are in the current group of no-loan students,” he revealed.Sorry, there are no polls available at the moment.