The Department of Education’s decision this month to reverse its denial of loans to thousands of parents trying to help their children go to college clears the way for institutions to try to recover from what has been widely characterized as a fall enrollment disaster for many Historically Black Colleges and Universities (HBCUs).
Secretary of Education Arne Duncan says the agency has reviewed complaints from a number of institutions and advocacy groups and has decided to use the “extenuating circumstances” provision of its Parent PLUS Loan program to reconsider the rejected loan applications.
The new, more forgiving conditions governing the review process suggest the agency will probably waive most of the tougher loan restrictions imposed this spring and summer.
For example, the agency will reconsider applicants who have received Parent PLUS Loans (PPLs) in the past two years and would have received one this year were it not for some debt collections or charge offs that are more than 90 days delinquent. The agency will also reconsider first-time applicants who were denied due to having some “small amount” of “delinquency” in their credit history, Duncan says.
Officials at several universities welcomed the policy decision and said they were already trying to contact students adversely affected this summer and fall by the PPL rejections in hopes of getting them back in school after the winter break.
At the same time, several said they now face the challenge of getting affected students to come back to school in the middle of an academic year, asserting some may opt to wait until next fall, switch to some other institutions or forgo college altogether.
Regardless, some fear what appears to be an unintended blip on the radar could have a more long-term negative effect than federal officials envisioned when they tightened the loan approval requirements.
