College loans and who is borrowing

College loans and who is borrowing
England-Siegerdt, (2011) writes on a current study found that the following types of students are less likely to borrow: first generation college students; females; students considered financially dependent on their parents; and students who are Asian/Pacific Islanders, Hispanic, or American Indian. The purpose of the study was to determine which students are likely to borrow from a federal student loan program. Therefore, the dependent variable was dichotomous based on whether the student borrowed from any of the following federal student loan programs: Perkins, Subsidized Stafford, Unsubscribed Stafford, or Parent PLUS. The variables included race and ethnicity, income, first generation status, age, gender, and dependency status. The independent variables were selected based on prior research on the impact of loans on college access and borrowing trends over time. Binary logistic regression analysis was used to determine if there were relationships between the six independent variable and student borrowing from federal loan programs. The six independent variables were a combination of continuous, categorical, and dichotomous variables. Since there were varying relationships to a dichotomous dependent variable, BLR was selected because of its ability to accommodate these conditions.

The results suggest that some students are less likely to borrow from federal student loans programs than others. Being a first generation college student loan decreases the likelihood that a student will borrow. The same is true for students who are female and for students who are financially dependent on their parents. Students who are Asian/Pacific Islanders, Hispanic, or American Indian also have less likelihood of borrowing than white students.

The results also show that certain students are more likely to borrow than others. For instance, older students have greater odds of borrowing from federal student loans programs than younger students. In addition, students from higher income families are more likely to borrow from a federal program. For those students, every $1000 of additional income increases the odds of borrowing 2.5%. African American students are also more likely to borrow than white students.
England-Siegerdt, (2011) article results indicate that students who are White, older, male, financially independent of their parents, or have a higher family income are most likely to borrow. However, even though the current study also found that students who are first in their family to attend college, students from lower income families, and students from certain groups are less likely to borrow England-Siegerdt, (2011).

Perna, (2008) study develops a better understanding of U.S. high school students perception of loans and the forces that shape these perceptions in particularly important, given the pervasiveness of loans as a means to finance the accelerating prices find that although virtually all students are aware of loans, willingness to borrow varies based on characteristics of the school attended. The study also describes how parents and school personnel influence students perceptions of loans.

To better understand students perception of loans and the forces that contribute to these perceptions, this study relies on a multi-level conceptual model. The conceptual model draws on multiple theoretical perspectives and situates the college-enrollment decision-making process within several layers of context. The conceptual model assumes that students college-enrollment decisions are shaped by four nested contextual layers: the student and family context; the school and community context; the higher education context; and the broader social, economic, and policy context.
Data collection and analyses research teams completed the protocols using multiple sources, including the demographic and academic school profile, a review of the federal, state and local policies, and individual and focus group interviews. At each school, a research team conducted focus groups with 9th and 11th grade students and 9th and 11th grade parents and semi-structured interviews with teachers and counselors. Between 20 and 58 students, teachers, counselors and parents participated in the study, for a total of 596 participants
Perna, (2008) findings have several implications, first all participating students indicated that they are aware that loans are uses to finance postsecondary education expenses. Many acknowledge the ubiquity of loans and express a preference for other forms of aid, but are resigned that loans may be necessary to attend college. The primary and consistently articulated reason for wanting to minimize the use of loans pertains to the need to replay the amount borrowed. Secondly the anxiety about the obligation to repay loans is particularly common at a low-and middle-resource school. Most students at the high-resource schools, some students at the middle-resource schools, and few students at the low-resource schools, express a willingness to borrow to pay college expenses. For many the participating student, willingness to borrow is based on a comparison of the expected benefit and costs Perna, (2008).

Jackson, (2010) study says a case can be made for the value of a college education as an intellectually elevating experience quite apart from wherever it contributes to individual careers or to economic growth. That may be, but federal grants and loans for needy students to attend college are justified partly as a means to equalize opportunities and partly to make the economy more productive. After all most students go to college, not for the love of learning but to qualify for a well-paying job and interesting career Jackson, (2010).
The mixed messages that counselors and teachers send to students about loans indicate the need for additional counseling, especially for students attending low and middle resource schools. Most middle and lower resource schools have higher minority rate which results in minorities not understanding or taking advantage of a higher education or college loans. We need to educate the educators before we can help students understand their opportunities.