Dive Brief:
- Starting by the end of March 2015, credit requirements will be loosened for students and parents seeking federal PLUS loans.
- The new regulations are essentially the same as what the U.S. Department of Education proposed in August, Inside Higher Ed reported.
- The changes will allow about 370,000 more applicants to qualify through the initial credit check in the PLUS loan application process.
Dive Insight:
Two of the more significant changes are that the education department will consider only the past two years (instead of five) of the applicant’s credit history, and it will allow an exemption for up to $2,085 in delinquent debt for each applicant. The department will also start publishing PLUS loan default rates for the alumni and their parents for each college and university. The credit history changes come after lobbying by historically black colleges, which saw a spike in PLUS loan denials for their students — followed by enrollment declines — when the department tightened the credit requirements for the program in 2011.