An Issue of Fairness and Equity
Jun 2nd, 2008 • Posted in: What They're Saying“There’s been a certain amount of market segmentation going on, but this is the first time we’ve seen a lender, especially as large as Citibank, saying, ‘We don’t want to do business with you.’… There’s a fundamental issue of fairness and equity that’s certainly not being addressed in this. But short of completely revamping the way that financial aid, especially loans, is being delivered to students in this country, I don’t know that we have any easy answers.”
– Samuel Collie, director of financial aid at Eastern Oregon University, talking to the New York Times about cutbacks in loans being offered to his school’s students. The Times reports that powerful lenders such as Citibank, JPMorgan Chase, PNC, and SunTrust are closing their doors to students at community colleges, for-profit universities, and other less competitive institutions. “These institutions, which are a stepping stone to other educational programs or to better jobs, often draw students from the lower rungs of the economic ladder,” notes the paper. According to the Times: “The practice suggests that if the credit crisis and the ensuing turmoil in the student loan business persist, some of the nation’s neediest students will be hurt the most. The difficulty borrowing may deter them from attending school or prompt them to take a semester off. When they get student loans, they will wind up with less attractive terms and may run a greater risk of default if they have to switch lenders in the middle of their college years.”
Source: New York Times, June 2.
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