Banks ignore some community colleges
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Scott Jagow: The New York Times has a very interesting story this morning about student loans. The paper says banks are ignoring some community colleges and lesser-known universities all together. So that means their students will have a tougher time getting money for their education. More now from Nancy Marshall Genzer.
Nancy Marshall Genzer: The banks look at future earning power and default rates when deciding whether to made a student loan.
Standard and Poor’s chief economist David Wyss says too often, students at less-selective colleges default.
David Wyss: And then because of personal problems, job problems, because they don’t complete the programs, they can’t pay the money back.
Susan Mead: I don’t agree with that statement.
Susan Mead is the financial aid director at Dutchess Community College in Poughkeepsie, New York:
Mead: Our default rate is approximately right now about 9 percent. So that’s nine students out of a hundred who may be having difficulty repaying their loans.
Mead says banks are shooting themselves in the foot, because the very students they’re rejecting now feed into the four-year colleges the banks want to lend to.
In Washington, I’m Nancy Marshall Genzer for Marketplace.
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