Davidson College Eliminates Student Loans

Davidson College, a small liberal arts college in North Carolina, says it will begin meeting students' financial aid needs without student loans so that they may graduate debt free.

As aresult, all Davidson students will have their demonstrated financial need funded entirely through grants and student employment.

"We believe this new policy is the necessary response to the financial situation facing many applicants and their families, and know it isconsistent with a core value of the college," says Davidson College President Robert Vagt. "A Davidson education should be affordable for all students, regardless of means. This is an historic change for Davidson and for liberal arts institutions across the nation. With the support ofthe entire college family, from students to faculty, trustees to alumni, we are confident this bold reform will prove to make a significant difference for our students, our institution, and our community."

Taking effect in August, this new policy makes Davidson the first national liberal arts college in the country to adopt such a policy, eliminating student debt for its graduates. Davidson will meet 100 percentof the demonstrated need with grants and student employment, but families retain the option to take out education loans as part of personal financing, the college says.

Davidson says will maintain its commitment to practicing need-blind admissions, meaning the family's ability to pay for a Davidson education has no bearing on whether or not the student is admitted.

Currently, 33 percent of Davidson students receive need-based financial aid, with packages inclusive of grant, loan and campus employment. Nationally, college students borrow $53.8 billion per year to cover college costs.

Davidson says it is the first national liberal arts college, and only one of a couple of institutions of higher education, in the country to completely eliminate loans from student aid packages.

"The trustees are deeply committed to this new policy that will befunded entirely with new monies," says John McCartney, chair of Davidson's board of trustees. In order to allow students to graduate from Davidson debt-free, the trustees say they have identified and committed the immediate funding needed to initiate this policy, while formally committing to a strategy for raising new monies to endow the program, says McCartney.

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