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Addressing
the Student
Loan Crisis
Student Loan Experts
Dissect the
Trends for African Americans
By CHRISTOPHER WINDHAM
WASHINGTON-The
rising crisis with student loans among African Americans
was debated during the Congressional Black Caucus’s
annual Legislative Conference
As
part of the conference’s Emerging Leaders Series,
experts from the public and private sectors of the
student loan industry examined trends in college funding,
including ways to reduce post-college debt and recent
government initiatives aimed at helping students fund
college.
Panelists
also used a portion of the panel to highlight some
of the alarming trends for African Americans when
funding their college education.
For
instance, African Americans use student loans to finance
college at a higher rate than any other group, with
about 65% of students receiving loans, according to
the U.S. Education Department. As a result, African
Americans leave college with higher amounts of student
loan debt than students of other nationalities.
“African
American students face tremendous challenges to getting
through college,” says Ryan J. Davis, Research
Analyst at the Pell Institute for the Study of Opportunity
in Higher Education. “We need to think through
and determine strategies so that trends we faced in
the last 30 years don’t repeat.”
Borrowing
in this recession is riskier for students in earlier,
more economically prosperous times, when there were
healthier job markets to support the borrowing. Now,
as the nation’s unemployment rate hovers near
10%, education finance experts fear today’s
borrowers might not have jobs to repay the loans.
“There
is concern that the jobs that I had, and my colleagues
had, might not be there today, “ says Kenneth
Redd, Director for Research and Policy Analysis for
the National Association of College and University
Business Officers. “We’re trying to help
students that are coming up in the next generation.”
Zakiya
Smith, confidential Assistant in the Office of the
Under Secretary in the Department of Education outlined
some of the measures the Obama Administration has
enacted or proposed to help students.
“The
Department of Education has been thinking about how
students fit into the labor force to create jobs that
benefit the recovery,” Smith says.
In
addition to creating jobs, Smith said the Obama Administration
in its recent economic stimulus package increased
the Pell Grant award maximum by $500 to $5,350. Smith
also listed several tools available online to help
borrowers manage their debt.
Financial
aid/literacy expert Dawn McCoy offered tips to students
and borrowers. McCoy urged both borrowers and lenders
to be socially responsible when considering a loan.
Among her tips for students who do borrow, McCoy says
student borrowers should be “creative and thoughtful”
about financing their education and should first seek
alternatives to loans, such as scholarships and grants.
McCoy
also said students should manage their student loan
debt by repaying loans and being mindful of financial
tools available to them. 
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