Carleton College Eliminates Student Loans From Financial Aid Packages

NORTHFIELD, MN — Carleton College in Northfield announced this week it will eliminate loans from its financial aid packages beginning next fall, becoming the first college in Minnesota, and one of about 20 nationally, to fund 100 percent of student need through grants, scholarships and campus employment alone.

The change will apply not only to incoming students but also to current first year, sophomore and junior students, according to the college.

Subscribe

More than half of Carleton students, 57 percent, currently receive need based financial aid, which covers tuition along with housing, meals, activities and other costs.

Unlike some tuition promise programs that set income limits for eligibility, Carleton's no loan policy has no income cap. Students need only qualify for need based aid.

For the current academic year, the average financial aid award at Carleton is $71,866, leaving the average aided family paying about $21,763.

President Alison Byerly said the policy reflects the college's belief that a family's finances should not determine whether a student can attend. She said students will now be able to graduate without loan debt limiting their choice of career or graduate study.

The shift was funded by more than $80 million in gifts collected over the past 10 months from alumni and friends of the college, including every member of its board of trustees. Carleton is now seeking to raise an additional $48 million to build a long term endowment to sustain the program.

Vice President and Dean of Admissions and Financial Aid Art Rodriguez, a 1996 Carleton graduate, said the timing matters given new federal limits on how much graduate students can borrow. He said eliminating loans at the undergraduate level will let alumni pursue advanced degrees without carrying debt from their time at Carleton.

Carleton has long emphasized affordability, including reducing expected family contributions for households with multiple children in college and treating home equity as a protected asset for middle income families. For more than a decade, about one third of each incoming class has come from middle income households, a group officials expect to benefit most from the new policy.

The average Carleton graduate in the class of 2025 left with $21,075 in debt, well below the national average of $39,075, and the loan default rate among graduates remains under 1 percent.