Student loan debt is approaching the unfathomable $2-trillion mark, putting a burden not only on borrowers but also on banks, which has prompted some analysts to say it could help trigger the next financial crisis.
Some universities are trying to reverse the trend with no-loans policies that make sure you graduate with no or low student loan debt.
Even a $1.8 billion gift to Johns Hopkins University to substitute loans with scholarship grants won’t put a big dent in America’s student loan problem, Market Watch reported.
With his $1.8 billion gift, philanthropist and former New York City mayor Michael Bloomberg made the largest donation in history to a university, and most high-profile gift directed towards scholarships in recent memory.
Johns Hopkins plans to eliminate loans in its financial aid offers wWith the money.
For academic year 2017-2018, undergraduate tuition and fees at Johns Hopkins University were $52,170, according to a college admissions comparison site.
About 300 colleges have a large enough endowment to afford a no-loans policy, and 70 schools have adopted the policy, said Mark Kantrowitz, a financial aid expert and the publisher of SavingForCollege.com.
“Bloomberg’s donation might trigger a new spike,” he said, according to CNBC.
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Kantrowitz compiled a list of colleges and universities that no longer have student loans. Some of them include all students in the policy, while others are for low-income or local students.
A C does not eliminate all student debt. Students can still borrow their share of the college costs, Kantrowitz said. Twenty-four of the college no-loans financial aid policies began as free tuition policies. Some have found that no-loan and free-tuition policies help motivate alumni donations. Find more details at SavingForCollege.com.
