ECC head says student loans for college are down

Elgin Community College students are having to borrow less for their studies, school officials said.

The amount students take out in federal loans has dipped in the past five years - from $6.3 million in 2010-2011 to $3.6 million in 2014-2015.

Officials say it's the result of the college providing financial literacy education and implementing a mandatory loan counseling program for students considering borrowing to help them plan and budget better during a one-on-one, 30-minute session with a financial aid adviser.

Lack of financial literacy is the main reason student debt spirals out of control, ECC President David Sam said.

"They don't realize they have to pay it back," he said. "It's not unique to ECC. It's a big national issue."

Student loan debt in the U.S. has soared to $1.2 trillion, and 40 million Americans are paying off student loans, he added, quoting marketwatch.com.

Sam is urging ECC students to avoid loans, if possible, during the state budget crisis, which is affecting grant funding for students most in need.

"We don't discourage the students from getting loans," he said. "In some cases, (we) steer them to scholarships that they might not know about. I implore students to inquire about other ways to pay for their education without taking out a sizable student loan. The lack of MAP funding this year makes student loans appear more appealing, but could ultimately lead to financial ruin."

One way to avoid student loans is to apply for scholarships or a student work-study program. The ECC Foundation offers more than 125 student scholarships yearly, officials said.

ECC's financial literacy program also reaches into area high schools preparing students for the cost of going to a community college versus a four-year institution. The goal is "to educate our community and our students earlier before they are at that turning point," said Kim Wagner, ECC's managing director of student financial services.

Roughly 10 percent of ECC's more than 10,000 students - 1,009 - borrowed money last school year. That's down from 1,769 students who received federal loans in 2010-2011. Last year, students borrowed on average $3,625; the college's annual tuition and fees for a full-time student is $3,582.

Officials said college counselors help students consider all of their needs when borrowing, including transportation and housing costs.

"We're not just looking at tuition, fees, books," Wagner said. "We're looking at what is that financial gap that they need (filled) in school to make ends meet."