Dartmouth eliminates student loans for undergraduates and replaces them with scholarships
Dartmouth College will eliminate all federal and institutional student loans from its financial aid awards, replacing them with scholarships.
The change took effect at the start of Dartmouth’s summer term on June 23. Prior to the new policy, Dartmouth undergraduates from families earning less than $125,000 per year were already offered need-based financial aid without a loan component, starting in June 2021. Now all students undergraduate students receiving need-based financial aid will no longer have a loan component.
Dartmouth said the policy change was made possible by more than $80 million in donations from more than 65 alumni. College debt will decrease by an average of $22,000 over four years for about 450 Dartmouth students, according to a Dartmouth press release.
Dartmouth is among six Ivy League universities, including Penn, to adopt a no-loan policy. Implemented in 2009, Penn’s policy allows students of all income levels to receive loan-free financial aid packages.
Today, 46% of current undergraduate students at Penn receive financial aid in the form of scholarships in 2020-21, with an average award of $56,095. Yet 32% of 2015 Penn graduates still took out loans to pay for their education. These students graduated with an average debt of $18,900 in federal and non-federal student loans.
Dartmouth’s no-lending policy is part of the university’s The Call to Lead campaign, which is “a bold invitation to the global Dartmouth community to engage with the big issues of this century and the next”, according to its website.
“Thanks to this extraordinary investment from our community, students can prepare for lives of impact with fewer constraints,” said Dartmouth President Philip J. Hanlon. “Eliminating loans from financial aid programs will allow Dartmouth undergraduates to pursue their purpose and passion in the widest possible range of career opportunities.”
Dartmouth has implemented other changes to financial aid following the $120 million they raised in scholarships last year, including offering blind admissions to international students.