For many students, Parent PLUS loans are packaged on the financial-aid award letters they get from their colleges, along with Pell Grants, loans, and institutional scholarships. They’re shown as an option — one endorsed by the federal government — for how to come up with the money to pay the bill.
But unlike other federal student loans, they’re not capped. You can borrow up to the full cost of attendance.
So after you fill out the FAFSA and the government determines what your “expected family contribution” is, it then makes a loan available that can be far, far larger. Finally, unlike other student loans where we hope a student borrower is going to use future higher earnings to pay for a degree today, a mother’s earning potential isn’t directly improved because her son got a college degree. (You can see why many education policy experts are pretty skeptical of Parent PLUS.)
Colleen Campbell, director of postsecondary education at the Center for American Progress, told the students for the USA Today article that the program is “doing a huge disservice to students of color and families of color when we’re saying that they can borrow however much they want.”
An epilogue to the story of the Morehouse graduation gift: The college announced last month that Robert Smith would be erasing parent loans as well for the class of 2019. Yes, Virginia. There is a Santa Claus.