Starting with the class of 2027, Dartmouth College will replace all federal and institutional loans for undergraduates with grants. Photo courtesy of Dartmouth College
June 21 (UPI) -- Dartmouth College President Philip Hanlon has announced that the institution will be replacing all federal and institutional loans for undergraduates with expanded scholarship grants.
Hanlon announced the change to the school's undergraduate financial aid awards Monday before alumni, stating the move "will allow Dartmouth undergraduates to seek their purpose and passion in the broadest possible range of career possibilities."
Dartmouth currently offers financial aid with a loan component to undergraduates from families with an annual income of $125,000 or more. Those from families who make less than $125,000 receive financial aid without a loan.
Under the new policy, Dartmouth will remove the loan component for all undergraduates who receive need-based financial aid.
"This will decrease the debt burden for hundreds of middle-income Dartmouth students and their families by an average of $22,000 over four years," the school said. "This in turn will open opportunities for young graduates to consider career opportunities or advanced degrees that they might not otherwise have been able to pursue."
The first students to benefit from the program are enrolled in this summer's term, it said, adding the money for this initiative comes from The Call to Lead fundraising campaign that began in 2018.
In total, $80 million in gifts to the endowment have been made by more than 65 families, it said.
The announcement was made amid rising concerns over the burden of student debt in the United states.
According to the Education Data Initiative, student loan debt in the United States has reached $1.762 trillion this year, up from $959 billion a decade earlier.
The debt burden on top of the financial stresses of the COVID-19 pandemic prompted Democratic lawmakers early this year to call on President Joe Biden to immediately cancel up to $50,000 in debt for federal student loan borrowers.
The president, who has extended a pandemic-related pause on student loan repayment until the end of August, told reporters in late April that while he is not thinking about doing that, "I am considering dealing with some debt reduction."
"I'm in the process of taking a hard look at whether or not there will be additional debt forgiveness, and I'll have an answer on that in the next couple of weeks," he said.