Why 20+ HBCUs Canceling Student Debt Matters
By CultureBanx Team
- More than 20 HBCUs are using the $5 billion for debt relief to cancel student loan debt
- Young Black adults take on 85% more education debt than their white counterparts
A growing group of historically Black colleges and universities (HBCUs) have moved to cancel student debt in recent months. More than 20 HBCUs are using the $5 billion for debt relief created from the Higher Education Emergency Relief federal pandemic funds, according to the United Negro College Fund. With the burden of student loan debt worsening wealth inequality and continuing the debt disparity among Black college students, this new wave of cancelling HBCU student debt is a racial wealth gap game changer.
Why This Matters: Young Black adults take on 85% more education debt than their white counterparts, and that disparity compounds by 7% each year after the borrowers leave school, according to a recent study in the Sociology of Race and Ethnicity journal. Students of color typically rack up hundreds of thousands of dollars in student loan debt, meaning they are unable to focus on other financial goals like buying a home, paying off credit card debt, and saving for retirement.
Eliminating this will start to narrow the racial wealth gap for young families, with 86.6% of Black students taking out federal loans to attend four-year colleges, compared to just 59.9% of white students. Not to mention that HBCU students are more likely to default over a 12-year period, than African Americans attending other four-year colleges and universities, according to the Wall Street Journal. Just another reason why cancelling this debt will have a positive long-term impact.
“I can use that money and invest it into my future," Rodman Allen, 2021 graduate of Wilberforce, said in a statement.
These institutions have been putting the money to good use. Here’s a breakdown of how some of these great schools have used the funding:
- South Carolina State University - Canceled $9.8 million of student debt for 2,500 students
- Wilberforce University - Cancelled all student loan debt and fines owed to the school from the classes of both 2020 and 2021
- Delaware State University - Cancelled up to $930,000 in student loan debt for more than 220 recent graduates from 2020 and 2021
- Clark Atlanta University - Eliminated students account balances from the last five semesters
- Shaw University - Cleared 195,330 for 57 seniors and is covering summer tuition for more than 400 students
- Fayetteville State University - Cleared almost $1.7 million in unpaid tuition and fees for 1,442 students
- Trinity Washington - A predominantly Black institution, erased the balances of 400 students, for $1.8 million
- Philander Smith College - Spent nearly $2 million clearing debts for almost 500 recent graduates and continuing students
- Elizabeth City State University - Cleared 212 students balances dating back to May 2020, with the tab totaling $284,500
Situational Awareness: Schools say they couldn’t have offered the debt forgiveness without the wave of funds the federal government released during the pandemic. However, it’s important to note that this is student debt that students owe to the college, not student loan cancellation for private or federal student loans that’s being forgiven.
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