A Student Loan Credit Crunch — But for Whom? (Inside Higher Ed)

. . . “Students with poor credit ratings, particularly those at trade schools whose graduates have poor repayment track records, might be unable to find a willing private student loan provider,” the New America Foundation’s Education Policy Program wrote on its blog this month. “All students, however, who apply for a private student loan with a creditworthy co-signer should be able to obtain a loan and obtain it at a lower interest rate than they otherwise would receive. Private student loan borrowers who don’t have a creditworthy co-signer and who are pursuing academic programs at schools with dubious job placement and loan repayment track records should consider lower cost education options.”

The idea suggested in the New America post — that the credit crunch isn’t a major problem because it is affecting mostly students at for-profit colleges, and should actually prod students who take out costly private loans at for-profit schools to enroll instead in community colleges or other lower-cost institutions — has been a subtext of some of the discussion surrounding the credit crunch, and reveal just how differently the crisis is perceived in various quarters. . . .