TSU, Fisk help students weather new loan rules

Quiet adjustments to the U.S. Department of Education’s PLUS loan program hit the nation’s historically black colleges and universities, or HBCUs, the hardest because a larger percentage of their students come from low-income families who are dependent on those loans.

“It really did a number on them,” said Christy Barbo, loan manager at TSU. “If you’re not allowing parents to borrow, (their children) can’t go to school.”

Before the change, 42 percent of those who applied for the PLUS loan at TSU were approved, but afterward, only 27 percent were approved, Barbo said.

“That really hindered us because funding is limited,” she said.

A change in eligibility requirements caused the issue. Before, parents had to show they were up to date with all current payments for the past 90 days. The change requires a credit check that goes back five years. Any delinquent payments — even on utility bills — bankruptcies, tax liens or garnishments could be cause for denial, Barbo said.

The changes were made in late 2011, but many were caught off guard, finding out only when a student who had received a loan for the fall semester was denied another loan for spring, Barbo said.

“It was kind of hush-hush,” she said. “To find out what was going on, I had to call and ask.”

 

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