Fewer Resources, More Debt: Loan Debt Burdens Students at Historically Black Colleges and Universities

Student loans have become an increasingly important way for students and their families to pay for college, but for students at historically black colleges and universities (HBCUs), student loan debt is a substantial burden. Students who attend these institutions--many of whom are low-income and first-generation--must borrow at higher rates and, consequently, graduate with substantially higher debt than their peers at non-HBCUs. This issue brief examines the rates, amounts, and distribution of student loan debt among HBCU students relative to their non-HBCU peers. This analysis focuses solely on undergraduates attending four-year public and private, non-profit institutions, and employs the most recent publicly available data. Key findings include: (1) A higher percentage of students attending HBCUs use federal loans to finance college compared to their non-HBCU peers; (2) HBCU graduates borrow substantially greater amounts of federal loans than their non-HBCU peers; (3) The percentage of HBCU graduates who borrow large amounts ($40,000 or more) of federal loans to finance their degrees is four times that of non-HBCU graduates; (4) A higher percentage of HBCU students borrow not only federal subsidized loans, but also more costly federal unsubsidized loans and Parent PLUS Loans; (5) A higher percentage of HBCU students combine federal, state, and private loans to pay for college than their non-HBCU peers; and (6) HBCU students have lower loan repayment rates than non-HBCU students. The report discusses policy recommendations to address the financial challenges that HBCU students face in financing their college education and repaying their student loans. The following are appended: (1) Methodology; and (2) Top 10 HBCU Endowments and Top 10 Non-HBCU Endowments, 2015.