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When billionaire Robert F. Smith announced that his family will eliminate the student loans of the Morehouse College class of 2019, news media reported two different estimates of the total cost of the pledge. One estimate totaled $10 million and the other totaled $40 million. The difference is the larger figure includes parent loans.
Nationally, a cumulative 14.4% of parents of Bachelor’s degree recipients borrowed Federal Parent PLUS loans, based on data from the 2015-16 National Postsecondary Student Aid Study (NPSAS). At Morehouse College, the figure is much, much greater.
Which Colleges Have High Parent Debt?
Unfortunately, there is no publicly available data concerning parent debt at graduation for any specific college. Instead, the FSA Data Center provides quarterly and annual loan disbursement data by college for each of the major federal education loan programs, including Federal Parent PLUS loans.
Combining 2017-18 loan disbursement data with fall 2017 undergraduate enrollment data from the Integrated Postsecondary Education Data System (IPEDS) provides insights concerning student and parent borrowing rates by college.
This table shows all 58 of the colleges where more than half of the undergraduate students borrow unsubsidized Federal Direct Stafford Loans and where more than a quarter of their parents borrow Federal Parent PLUS Loans. (Among all 4-year colleges, only 9% of parents borrowed Federal Parent PLUS loans in 2017-18.) The table is also limited to colleges with 250 or more full-time undergraduate students. The table is sorted according to the percent borrowing Federal Parent PLUS Loans.
College |
HBCU |
Percent Unsubsidized Stafford |
Percent Parent PLUS |
Ratio |
Percent Black & Hispanic |
Clark Atlanta University (GA) |
Yes |
88% |
58% |
66% |
85% |
American Musical and Dramatic Acad. (NY) |
83% |
57% |
69% |
43% |
|
Spelman College (GA) |
Yes |
58% |
48% |
83% |
97% |
Hampton University (VA) |
Yes |
67% |
48% |
71% |
98% |
Morehouse College (GA) |
Yes |
68% |
45% |
66% |
94% |
Ferrum College (VA) |
84% |
44% |
52% |
39% |
|
Virginia Union University (VA) |
Yes |
92% |
43% |
47% |
96% |
Wesley College (DE) |
88% |
40% |
46% |
51% |
|
William Peace University (NC) |
85% |
40% |
47% |
37% |
|
Chowan University (NC) |
91% |
37% |
41% |
74% |
|
Kansas Wesleyan University (KS) |
93% |
35% |
37% |
31% |
|
Moore College of Art and Design (PA) |
87% |
34% |
39% |
27% |
|
Lincoln University (PA) |
Yes |
91% |
34% |
37% |
88% |
Lenoir-Rhyne University (NC) |
68% |
33% |
49% |
20% |
|
Hartwick College (NY) |
75% |
33% |
44% |
19% |
|
Shaw University (NC) |
Yes |
92% |
32% |
35% |
73% |
Livingstone College (NC) |
Yes |
98% |
32% |
33% |
80% |
Tuskegee University (AL) |
Yes |
67% |
32% |
48% |
81% |
Xavier University of Louisiana (LA) |
Yes |
66% |
32% |
49% |
82% |
Benedict College (SC) |
Yes |
89% |
32% |
36% |
97% |
Columbus College of Art and Design (OH) |
73% |
32% |
43% |
17% |
|
North Carolina Central University (NC) |
Yes |
89% |
32% |
35% |
87% |
Delaware State University (DE) |
Yes |
72% |
32% |
44% |
79% |
South Carolina State University (SC) |
Yes |
83% |
31% |
38% |
96% |
Mount Saint Mary College (NY) |
79% |
31% |
39% |
25% |
|
New Hampshire Institute of Art (NH) |
87% |
31% |
35% |
7% |
|
Claflin University (SC) |
Yes |
86% |
31% |
36% |
94% |
Dillard University (LA) |
Yes |
91% |
30% |
33% |
91% |
Virginia State University (VA) |
Yes |
85% |
30% |
35% |
40% |
Bethune-Cookman University (FL) |
Yes |
84% |
30% |
35% |
83% |
Stevenson University (MD) |
70% |
29% |
42% |
34% |
|
Marymount Manhattan College (NY) |
56% |
29% |
52% |
24% |
|
Howard University (DC) |
Yes |
55% |
29% |
53% |
90% |
Fisk University (TN) |
Yes |
63% |
29% |
46% |
87% |
Longwood University (VA) |
58% |
29% |
50% |
15% |
|
Molloy College (NY) |
79% |
29% |
36% |
26% |
|
Morrisville State College (NY) |
77% |
29% |
37% |
28% |
|
Ringling College of Art and Design (FL) |
52% |
28% |
55% |
21% |
|
Pace University-New York (NY) |
55% |
28% |
51% |
23% |
|
Virginia Wesleyan University (VA) |
72% |
28% |
39% |
35% |
|
The University of the Arts (PA) |
78% |
28% |
36% |
28% |
|
Columbia College Chicago (IL) |
73% |
28% |
38% |
27% |
|
Cornish College of the Arts (WA) |
66% |
27% |
41% |
17% |
|
Monmouth College (IL) |
68% |
27% |
40% |
21% |
|
Georgetown College (KY) |
69% |
27% |
39% |
9% |
|
University of Mary Hardin-Baylor (TX) |
71% |
26% |
37% |
36% |
|
Savannah College of Art and Design (GA) |
51% |
26% |
51% |
18% |
|
Emory & Henry College (VA) |
67% |
26% |
39% |
12% |
|
Emmanuel College (GA) |
62% |
26% |
42% |
22% |
|
Wittenberg University (OH) |
71% |
26% |
37% |
14% |
|
Alabama A & M University (AL) |
Yes |
79% |
26% |
33% |
91% |
Hanover College (IN) |
58% |
26% |
44% |
9% |
|
Laguna College of Art and Design (CA) |
55% |
26% |
47% |
20% |
|
St John’s University-New York (NY) |
51% |
26% |
51% |
24% |
|
Dominican University of California (CA) |
72% |
26% |
36% |
26% |
|
Saint John Fisher College (NY) |
73% |
26% |
35% |
8% |
|
Florida College (FL) |
58% |
26% |
44% |
16% |
|
Western Carolina University (NC) |
|
65% |
25% |
39% |
13% |
All of these colleges are 4-year public colleges (16%) or 4-year private non-profit colleges (84%). Most of these colleges have a high percentage of minority student enrollment. More than a third (36%) of the colleges are Historically Black Colleges and Universities (HBCU).
More than a third of the students who borrowed unsubsidized Federal Direct Stafford Loans also had parents borrowing Federal Parent PLUS Loans. At Morehouse College the ratio was two-thirds.
These statistics demonstrate a greater willingness of parents of students at these colleges to sacrifice for their children’s future. Also, in many cases it is the students who will be repaying the Federal Parent PLUS Loans, not the parents, since the parents are low-income and cannot afford to repay the debt.
How to Handle Parent Debt
Nevertheless, the disproportionately high debt burden is a source of financial stress for students who graduate from these colleges and their parents.
Colleges sometimes present student and parent loans as making the colleges more affordable, since they enable families to pay the college bills. But, they rarely consider whether the students and parents are graduating with an affordable amount of debt.
Colleges and the federal and state government must do more to improve the affordability of these colleges by increasing the amount of grant funding available to the students.
Parents should consider not just the average student loan debt at graduation, but also the average parent loan debt at graduation. Parent borrowing has increased as more students are reaching the federal student loan limits.
Student loan debt is affordable if total student debt at graduation is less than the student’s annual starting salary. The student can then repay the student loans in ten years or less. Likewise, parents should borrow no more for all their children than their annual income.
