Democratic student loan waiver proposals have come in two sizes: large and larger.
President Joe Biden campaigned for a plan to waive $ 10,000 in federal student loans per borrower (though he ultimately removed the idea from his proposed budget). Massachusetts Democrat Senator Elizabeth Warren has called for a blanket waiver of up to $ 50,000 in federal loans per student, while Vermont independent Senator Bernie Sanders has called for the cancellation of all student debt at a staggering $ 1.6 trillion suggested.
But as an innovative effort by a group of colleges near Detroit proves, even modest student debt relief can have a big impact, especially when it is coupled with a second chance at college for those who dropped out. Programs like Warrior Way Back at Wayne State University and Eagle Engage Corps at Eastern Michigan University offer alumni a combination of loan origination and the opportunity to graduate. It’s a smart – and focused – approach to student debt relief that could benefit hundreds of thousands of students across the country. Most importantly, it won’t cost trillions and schools won’t have to wait for Congress to act.
According to the National Student Clearinghouse, in 2018 about 36 million Americans had “some college” but no degree, and of those about 10 percent – or 3.5 million – are “prospective graduates” with at least two years of college education. Outstanding student debt prevents many students from returning to school. Colleges typically don’t allow students to re-enroll (and make more commitments) unless previous debts have been paid. Most schools also do not give out transcripts to students with outstanding balances (a practice some states prohibit).
For alumni who dropped out of college near graduation and who have relatively little debt, these barriers are needlessly tough, says Dawn Medley, assistant vice president of Wayne State University. “If you have a car and need tires but don’t pay off the tires, come and get the tires, not the car,” she said. “But in higher education we hold every section of your academics hostage, and I just don’t think we have to do that.”
The solution Medley developed was Wayne State’s Warrior Way Back program. Launched in 2019, the program allows former students who owe the school $ 1,500 or less to re-enroll despite their outstanding debt. As long as the grades remain, the students will be forgiven part of their debts each semester. The participants – mostly adult learners who combine work and family – also receive a wide range of support options such as study advice, career advice and help with access to childcare in order to secure their degree. To date, the program has enrolled more than 230 students and is expected to graduate 70 by the end of 2021, Wayne State’s Medley said. “The youngest student we had was 21 and the oldest 67,” she said. “We had mothers who graduated with their daughters and went to class together. It was really cool. “
One of the company’s current students is Jermaine Perguese, who plans to do his bachelor’s degree in construction management in December. Perguese, in his early 30s, said he moved from Tennessee State University to Wayne State in 2012 but dropped out. “I really didn’t have a lot of support when I got on campus, and it was difficult when you had a full-time job,” he said. “And then when I started fighting in class it was easy to stop.”
This time, Perguese gets the support he needs thanks to consultant Amber Neher. Neher helped Perguese resolve a loan default he was unfamiliar with and worked with him to use the credits already earned for his degree. “We’re very focused on debt relief, but that’s usually just a small part of the bigger picture,” Neher said. With her support, Perguese started with two lectures per semester and has since worked her way up to a full course load. “I took 20 courses in 12 months,” he said.
Not only students like Perguese benefit from programs like Warrior Way Back. The local economy benefits from a better educated workforce who can help a city or region create good jobs. In Detroit, for example, only 15 percent of residents have a bachelor’s degree or more (compared to 32 percent nationally), which is why the Detroit Regional Chamber announced its endorsement of the program and helped replicate the model at neighboring institutions . According to the chamber, nearly 700,000 adults in the Detroit area have college degrees but no degrees, many of them potential beneficiaries of these initiatives.
Schools also benefit from debt relief programs that allow students to return and stay enrolled. For one, Associate Vice President Medley says the Wayne State program has already raised $ 2 million in net income from students who can now return to campus (or online) and take additional courses required to complete their degrees . “It’s really simple math,” said Medley. “If you take six credit hours with us, that’s about $ 3,000. We’re basically just paying off $ 500 in debt and bringing in $ 2,500 in net student income. “
But more importantly, says Medley, the university deserves a second chance with alumni. “It completely changed the relationship we have with these students because we used to be the bad debt collector who kept them from graduating,” Medley said. “Now we’re the institution that says, ‘Hey, give us one more chance and let’s see if we can be a partner to help you get that degree.’”
Given these advantages, other Michigan schools have followed Wayne State’s lead. Schools introducing debt relief programs for returning students in 2019 include Oakland University in Auburn Hills, Henry Ford Community College in Dearborn, and Eastern Michigan University in Ypsilanti. In Eastern Michigan, alumni can be forgiven up to $ 6,000 in debt provided that students also do 30 hours of community service per semester and keep their grades. Oakland University couples its lending programs with $ 500 microscholarships per semester as an additional sweetener. To date, says Kelly Flemming, Oakland’s senior associate director, 286 students have enrolled in the program and have completed 123 of them as of 2019. Some of these students, Flemming says, worked with the school for more than a year before their first day of class to make sure they have the resources they need, like academic support and childcare. “We want students to feel really comfortable and safe on the path they are taking,” she said.
Innovative approaches like Warrior Way Back offer a possible way out of dead-end debates about the scope of student debt relief. First, they show that you don’t need budget-breaking, flat-rate debt relief to significantly improve student lives. Second, they point to a potentially vital role for colleges previously portrayed only as villains who put student borrowers into unmanageable debt.
The current discussions on student loan issuance should include suggestions to encourage further efforts such as Warrior Way Back. This could mean providing funding to help smaller schools meet the up-front costs of starting a program, as well as technical assistance in exchanging best practices. The result could be a renewed focus by colleges on the resources students need to succeed, and that is exactly what the administrators of Eastern Michigan are saying.
“If you open up to the public and say that you are a school of opportunity, it doesn’t just start when you walk into the facility – it has to be continuous,” said Jessica “Decky” Alexander. who is professor and director of the Eastern Michigan debt relief program. “Even if they leave, we need to figure out how to make sure students come back and provide ways to honor the start we gave them here. … It goes to the heart of what public post-secondary education could and should be. “
Students need more than debt relief. You need new beginnings and second opportunities. Congress should do more than write large checks to accomplish this.