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Typical SUNY Potsdam grad owes $26,000 in federal loans, students at SUNY Canton have median debt of $18,500

Posted 5/17/16

By CRAIG FREILICH Many college students, including those attending college in Canton and Potsdam, face mountains of debt they can only dream about paying off quickly if they don’t land a good job …

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Typical SUNY Potsdam grad owes $26,000 in federal loans, students at SUNY Canton have median debt of $18,500

Posted

By CRAIG FREILICH

Many college students, including those attending college in Canton and Potsdam, face mountains of debt they can only dream about paying off quickly if they don’t land a good job after graduation.

At SUNY Potsdam, a typical graduate leaves owing $26,000 on federal loans, according to ProPublica.org, a non-profit research organization. SUNY Canton graduates carry median debt of $18,500 on federal loans. And that does not include commercial or private loans.

The many students who drop out and don’t attain a degree are still burdened by a median federal loan debt of $10,277 at SUNY Potsdam and $8,250 at SUNY Canton.

“This is the biggest concern I have about American higher education: the amount of debt our students are carrying,” said SUNY Potsdam Executive Vice President Rick Miller.

In 2013, about 73 percent of SUNY Potsdam and SUNY Canton undergraduates had federal loans.

Miller said he is concerned about students with thousands of dollars left to pay for their educations.

“I’m worried for them. I deal with students who struggle from semester to semester. We work with parents on payment plans, particularly with students with academic difficulty,” he said.

Access vs. Affordability

But, Miller said, “We have an access mission. Our philosophy is that we want to be affordable, to work with students and the family. Loans are designed as a partial funding mechanism for students” so that those who might not be able to afford a college education can still get the chance to earn a degree.

“It’s fairly easy to get a loan, to go through the requirements, to follow the guidelines for a subsidized federal loan. If they don’t get a federal loan, they might go for a commercial loan, but that’s more problematic, with higher interest rates.

“The likelihood of misuse is much less with the federal controls in place. That’s in fairness to the taxpayers,” and reduces the chance of default, he said. “I want to be sure the employment opportunities are there.”

“We want students to get as much as they can from participating. But we need to have the right pathway and support,” he said.

The full bill at SUNY Potsdam in 2013 was $19,829 and at SUNY Canton, $19,394 year. On average, low-income in-state students at both schools paid 53 percent of that, according to Pro Publica.

Monthly Payments

Three years after graduation, Pro Publica found that Potsdam students who had taken out federal loans on a 10-year repayment plan had a mean monthly payment of $288.65, and among Canton grads, $205.39, according to the report “Debt by Degrees” released by ProPublica.org last November.

In 2013, those students who had paid back none of the principal on their loans stood at 17.8 percent at Potsdam and 32.2 percent at Canton three years after graduation, the report said.

Students who had any federal loans and had dropped out before graduation faced a mean federal debt of $10,277 at SUNY Potsdam, $8,250 at SUNY Canton, and no degree to support them getting a good job.

Recipients of Pell Grants could have a harder time paying off the debt.

In 2013, 43.7 percent of students at Potsdam had Pell Grants, and at SUNY Canton, 55.9 percent..

Pell Grants are a federal program for students with financial need that started in 1965. The grants are crucial for them, and recipients frequently get other aid from their schools, but many still turn to loans as a way to cover remaining costs.

At SUNY Potsdam in 2013, the median Pell recipient’s debt for federal loans on graduation was $21,000, compared with a $26,000 among all SUNY Potsdam graduates; at Canton, it was $13,055 for Pell recipients versus $18,500 for all grads that year.

Pell grantees tend to graduate at a lower rate than those who don’t receive them. The graduation rate within six years among Pell grantees at SUNY Potsdam was 41.6 percent, compared with 51.3 percent for all students. At SUNY Canton it was 20.6 percent compared with 30.2 among all students.

Adding the debt of student loans to the burden of hitting the job market without a degree can amount to a crushing reality for some people.

Pell Grants Help

Pell Grant recipients also cite financial troubles as among the most common reasons for dropping out or poor performance. Miller said.

“Often Pell Grant student statistics coincide with other indicators,” said Miller. “They can be a proxy indicator for other possible success indicators.”

Miller said many lower-income households can’t give their children the kinds of exposure and experience that can lead a student to the higher level of achievement that is valued more highly by educators and employers.

“Many are the first in their families to attend college,” embarking on the voyage without the benefit of the college experience earned by family members, he said.

Three years after graduation, the federal loan non-payment rate for Pell grads at Potsdam was 22.2 percent and 39.2 percent at Canton, about 5 percent higher than the rate among all students.