Oct. 18, 2013
By Brittany Hackett, Communications Staff
Concerns about the growing cost of higher education are taking a front seat in many students’ decisions about where to attend college. But what if there was a way for schools to address those increasing costs, encourage timely degree completion, and develop a strong sense of community among their students?
That’s the idea behind Pennsylvania’s Wilson College’s new debt buyback program, which offers prospective students a chance to reduce their Federal Direct Loan debt by up to $10,000.
Wilson is a private, four-year liberal arts college with a fall 2013 enrollment of 662 students, including a high number of first-generation students and Pell Grant recipients. Students at Wilson College graduate with student loan debt that is close to the national average of between $20,000 and $25,000, but school officials realized that more needed to be done to educate students about borrowing, particularly the importance of not over-borrowing.
“We know our students are going to need to borrow and take on debt and that’s a worthy investment in themselves, but we want them to borrow at a reasonable level,” Wilson College President Barbara Mistick said.
The student debt buyback program was approved in January 2012 by the college’s Board of Trustees and will be available to students entering in fall 2014, with the first eligible students graduating in 2018. The program is designed to encourage students to think more about how much and what kinds of loans they are borrowing to pay for college tuition, Mistick said.
The program is restricted to Direct Loans that relate to enrollment at Wilson College and students must meet the following criteria to qualify:
Pledge to borrow only what is necessary to meet educational expenses;
Participate in financial literacy programs, which are offered to all students in their freshman and senior years;
Be first-time college students who earn a diploma in four years or less of continuous, full-time enrollment at Wilson; and
Demonstrate active involvement and participation in activities and community services that would benefit the Wilson College community (i.e. student government, tutoring other students, campus sustainability initiatives, community organizations).
A student’s grade point average (GPA) out of a possible 4.0 will also determine his or her buyback amount:
$5,000 for those with a GPA of 3.5 to 3.69;
$7,500 for those with a GPA of 3.7 to 3.89; and
$10,000 for those with a GPA of 3.9 of higher.
Mistick said the program was deliberately designed to encourage students to take full advantage of what college life has to offer, academically, socially, and as alumni of the school. “I think what’s really interesting is that students today do want to feel part of a community, so we wanted to make sure we had a community element,” she said.
Wilson officials estimate that the program will cost up to $100,000 a year, depending on variables, which Misick said was a “reasonable” amount given the scope of the program and size of enrollment at Wilson. They expect the program to be funded through additional revenue generated by increased enrollments and student retention of those in the program.
“It’s a high investment in our students and an extension of how we invest in our students every day,” Mistick said, adding, “It really is about reaching back to one of the hallmarks that we do at small liberal arts colleges, which is to have really personal experiences with our students.”
In addition to the buyback program, the Board of Trustees last year voted to reduce the school’s tuition by 17 percent, or $5,000, to $23,745 for the 2014-15 academic year, but “it’s not just about resetting the tuition, it’s figuring how to work with the debt,” Mistick said. “I think the questions of affordability is not going away anytime soon and every institution is going to need to address that.”