First-Generation College Students Slower to Repay Student Loans at Arkansas Colleges
By Haley Ruiz
A data analysis of Arkansas colleges (excluding beauty schools) showed a gap in student loan repayment trends between first-generation college students and those from families who had attended college. The analysis showed the trend is especially prevalent at private institutions, with Lyon College having the biggest gap.
At Lyon College, 67 percent of non-first-generation students paid back their loans within five years, while only 53 percent of first-generation students did the same, which results in a 14 percent point difference. The median debt for both types of students was the same though, at $12,000.
The median statewide repayment rate for Arkansas college students is 87 percent. The median debt for both first-generation and non-first-generation students is $9,500.
While there is no specific program for first-generation college students at Lyon College, there is one for potential first-generation students who are in high school, said Tommy Tucker, director of financial aid at Lyon College. Additionally, there is a grant, Spragins Scholars, for first-generation male college students.
The Accelerated Program of Personalized Learning and Enrichment Project Upward Bound program at Lyon College serves high school students from low-income families and families in which neither parent holds a bachelor’s degree. A goal of the APPLE Project is to increase the rate at which participants enroll in and graduate from postsecondary education institutions, according to Lyon College’s website.
One of the general challenges that under resourced, definitively first-generation, students have is they have not received training on financial literacy, said Jeanette Youngblood, APPLE Upward Bound director at Lyon College. It is very possible no one has taught them about the true cost of college or how money works, such as the difference between credit and debit.
Youngblood said she thinks students who come from first-generation families, particularly at private schools, may not have access to the same level of financial aid. There may be a bigger gap between what the student received and what they owe, and many students fill those gaps with loans because they are unaware of the alternatives.
“It’s easy to not recognize how big that loan can become in a short period of time, and when the student graduates they have far more student debt than they realize,” Youngblood said. “Part of that is the student not understanding the difference between necessity and wants.”
Students take out loans knowing they will have to pay them back, but it is so far down the road that the students do not make the best choices in the meantime, Youngblood said. Students also sometimes take out more loans than they need.
Generally, first-generation students come from lower socioeconomic backgrounds and may not have as many advantages as other students, like more desirable standardized test scores, Tucker said. Lower scores sometimes equate to a lower chance of scholarships, and the price tag at most institutions is high without some kind of financial aid. Need is a component Lyon College considers when awarding financial aid, but it is not possible for the school to cover the need of every student.
One of the reasons the APPLE Upward Bound program works with low-income and first-generations students is that they might not have the financial background they need to be college prepared, Youngblood said. It is possible the parents cannot pay for a standardized test coach or other college preparation services.
“If the students’ parents haven’t gone to college then they don’t know how to help them navigate that,” Youngblood said. “My parents were supportive, but in reality, they had no wisdom to pass on regarding how to navigate college because they hadn’t done it personally.”
Youngblood said her daughter is having a very different experience because she has a parent who speaks the college language.
Ouachita Baptist University also had a significant gap in debt repayment between first-generation and non-first-generation students.
At Ouachita Baptist University, a private institution, 77 percent of non-first-generation students paid back their loans within five years, while only 65 percent of first-generation students did the same, which results in a 12 percent point difference. Both types of students had close to the same amount of median debt, with first-generation students $16,287 in debt and non-first-generation students $15,125 in debt, which results in a $1,162 difference.
“I think now with first-generation students, a lot of them don’t understand there are more scholarship opportunities out there,” said Melissa Church, student loan counselor at Ouachita Baptist University. “Students don’t take time to find scholarships. They choose to take out loans to get through college instead.”
Church said there is so much technology now, such as social media, that she thinks it hinders the initiative of students in searching for scholarships.
“Here, a lot of parents leave it to the child to find and apply for scholarships,” Church said. “They say, ‘that’s up to you to get that done,’ and I don’t see a lot of students who follow through with that.”
The Arkansas colleges following this trend that had an 11 percent point or more difference are all private institutions, with one exception – Southern Arkansas University Tech, a public school.
48 percent of non-first-generation students at Southern Arkansas University Tech paid back their loans within five years, while only 35 percent of first-generation students did the same, which results in a 13 percent point difference.
Additionally, there are three institutions with a 10 percent point or more difference (excluding beauty schools) that conflict with the trend in that more first-generation students are paying back their loans within five years than non-first-generation-students.
At East Arkansas Community College, a public institution, 49 percent of first-generation students paid back their loans within five years, while only 36 percent of non-first-generation students did the same, which results in a 13 percent point difference.
At Phillips Community College of the University of Arkansas, a public institution, 34 percent of first-generation students paid back their loans within five years, while only 24 percent of non-first-generation students did the same, which results in a 10 percent point difference.
At Williams Baptist College, a private institution, 69 percent of first-generation students paid back their loans within five years, while only 59 percent of non-first-generation students did the same, which results in a 10 percent point difference.
Many first-generation students have a harder time repaying their student loans, and this problem is especially prevalent at private institutions. There are exceptions to this trend in Arkansas colleges, but they are few when compared to the data trend.
Sources:
1. Lyon College
Tommy Tucker, director of financial aid
870-307-7257
ttucker@lyon.edu
2. Lyon College
Jeanette Youngblood, APPLE Upward Bound director
870-307-7263
Jeanette.youngblood@lyon.edu
3. Lyon College’s website
4. Ouachita Baptist University
Melissa Church, student loan counselor
870-245-4282
churchm@obu.edu
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