Web update: Vassar moves to eliminate loans from financial aid packages

Brian Farkas News Editor

Vassar College will replace loans in the financial aid packages of students with calculated family incomes of up to $60,000 with scholarship grants, President Catharine Bond Hill announced in an all-campus e-mail on Monday, March 10.

The policy will take effect in fall 2008 and will apply to all current students.

“We see this as another step in making Vassar as affordable and attractive as possible in an increasingly competitive environment,” said Hill in an e-mailed statement. “This reduces the net price of a Vassar education for these students, making us more affordable.”

The switch adds approximately $1 million a year to the College’s financial aid spending, which is about 23 percent of Vassar’s annual operating expenses. Approximately $34.5 million will be spent in Vassar scholarship grant funds in the 2008-2009 academic year, a 50 percent increase over the amount spent for financial aid five years ago.

Vassar currently gives need-based aid to approximately 55 percent of its 2,450 students. The switch will affect about 25 percent of all recipients. Out of the approximately 1,330 students who receive financial aid, about 340 will no longer face loans, given average loan packages of $2,950.

For students demonstrating need with family incomes above $60,000, financial aid packages will be distributed as they have been in the past. These packages typically include loans, grants and a campus job allocation, all depending on calculated need.

Due to Spring Break, college officials were not reachable for comment about how the policy affects PLUS loans, which differ from Stafford or Perkins loans.

The move to eliminate loans for families earning less than $60,000 is the second major financial aid expansion in the past nine months. In May 2007, Hill announced that the College would return to a need-blind admissions policy. Beginning with the Class of 2012, financial circumstance will no longer factor into a domestic applicant’s acceptance into Vassar.

In February, Hill announced the Poughkeepsie High School Scholarship Program, which will also begin next fall and will eliminate loans from the financial aid packages awarded to Poughkeepsie High School graduates who are accepted to Vassar.

The elimination of loans for families that earn less than $60,000 annually, like the Vassar’s need-blind financial aid practices, will not apply to international students.

The policy change comes during a general move toward increased financial aid spending at colleges and universities across the country. In November, Wesleyan University announced a similar plan that eliminated loans to students whose calculated family incomes are $40,000 per year or less, at an annual cost of approximately $3.2 million to the university. California State Polytechnic University in Pomona and Williams, Amherst, and Swarthmore Colleges, all with endowments valued at over $1.5 billion, have announced plans to eliminate loans from all financial aid packages beginning in fall 2008.