What will the result of this measure be?

Josh Mitchell of the Wall Street Journal reports:

Parents Poised to Gain Easier Access to College Loans

The Obama administration is moving to ease access to student loans for parents with damaged credit, a policy reversal that could saddle poor families with piles of debt but also boost college enrollment.

Under a plan likely to take effect next year, the Education Department would check the past two years of a borrower’s credit, instead of the current standard of five, for blemishes such as delinquencies or debts in collection. Also, any delinquent debts below $2,085 would be overlooked; currently, delinquencies of any amount are grounds for rejected applications.

Supporters of the plan say the loan program, known as Parent Plus, is increasingly needed to help poor families who lack savings afford the college of their choice. Without these loans, undergraduates are restricted to Stafford loans—capped at $57,500 for life—or private-sector loans, which generally go only to borrowers with the best credit. Parent Plus standards were tightened in 2011.


 
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