New Analysis Suggests Which Colleges Help Disadvantaged Students

Some colleges boast high student loan repayment rates.

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Looking for a college that helps lots of low-income students get good-paying jobs and teaches them the importance of repaying their debts? Take a look at the Massachusetts College of Pharmacy and Health Science.

Nearly half of the students at the Boston-based school come from families earning less than $40,000 a year—a group that, statistics show, is far more likely than others to drop out of college and default on student loans. But 68 percent of MCPHS freshmen graduate within six years. And fully 83 percent of recent MCPHS graduates were repaying their student loans last year. Both rates are much higher than the national averages for all students. Just 51 percent of recent college graduates were paying down their college loans last year. And just 56 percent of all freshmen graduate within six years.

Recent headlines about rising student loan default rates, soaring tuition pricing out low- and middle-income students, and scandals among for-profit college recruiters could obscure some good news: Many colleges take in low-income students and produce graduates who get jobs that enable them to pay back their loans.

[See a list of 49 colleges with unusually high loan repayment rates.]

An analysis of student loan repayment rates released in late September by Mark Kantrowitz, the publisher of Finaid.org, adjusts schools' student loan repayment rates by the demographics of their student bodies. This gives students and parents a new tool to see which schools potentially add value by taking in lots of disadvantaged kids and turning them into college graduates who earn and learn enough to repay their student loans.

Among the stars are niche private colleges such as MCPHS, the University of the Sciences in Philadelphia, and the Polytechnic Institute of New York University. Several public universities also stand out: Most of the University of California campuses, for example, take in high numbers of disadvantaged teens but also report unusually high graduation and loan repayment rates. Two New York City for-profit colleges also boast high loan repayment rates: the School of Visual Arts and the Laboratory Institute of Merchandising.

[Read more about other colleges with surprisingly high student loan repayment rates.]

Christopher Barto, dean of student financial services for the Laboratory Institute of Merchandising, says his graduates are better able to repay their loans than graduates of many other for-profit colleges—despite LIM's $45,000-a-year price tag—in part because all freshmen must take a course on how to succeed at school and work, which includes ample personal finance instruction. Many for-profit schools with lower repayment rates offer one-year certificates or two-year associate's degrees, while LIM offers a four-year bachelor's of business, he notes. LIM also combines traditional liberal arts classes on subjects such as writing and math with at least three internships at fashion companies that help students get jobs, he says.

Kantrowitz's data can also be used to identify colleges where students at least initially, pay down less of their loans than others in their demographics. Dominating that list: many community colleges, for-profit beauty schools, chiropractic colleges, and religious institutions. Some large and better-known colleges whose students have lower-than-predicted repayment rates include Troy University in Alabama, Webster University in St. Louis, and St. Petersburg College in Florida.

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