Utilization levels of non-federal loan programs among selected associated colleges of the south consortium member institutions

The increased costs of higher education, the limited availability of traditional forms of financial assistance and the decreased capacities of family resources to support educational expenses have caused many private institutional administrators to seek alternative forms of financing, such as non-federal loans to offer to students. The purpose of this study was to determine the extent of the utilization of non-federal educational loan programs and the impact these loan programs have had upon the Associated Colleges of the South (ACS) member institutions. The researcher utilized a mixed methodological framework for this study. The primary focus of this research involved a qualitative examination of selected ix ACS institutions in a case study setting. Quantitative survey research methods were also employed for descriptive purposes. Thirteen financial aid directors that completed surveys were interviewed. The qualitative data were analyzed and yielded five themes and eleven subthemes. Virtually, all of the ACS member institutions are utilizing or plan to utilize non-federal loan programs at their institutions. The administrators' motivation to utilize non-federal loans was classified into three subthemes: the need for options beyond the federal aid programs, alternatives for use in unique circumstances, and as an affordability mechanism to offer to families. The extent to which the nonfederal loans are actually utilized focused on whether the loans were used as a ìtool of last resortî or as strategic enrollment management tool to recruit and retain students. The emergent subthemes of student impact and institutional impact were analyzed to determine the advantages and disadvantages that had been witnessed at the ACS institutions. The findings from this study indicated that non-federal loans do indeed have the capability to assist institutions by providing an affordability mechanism to present to families, while simultaneously impacting institutional performance indicators. In addition, three recommendations were offered.