The conversation about student debt policy is heating up, and there’s been a recent focus on how student debt adversely impacts Black students. At Trellis Foundation, we care deeply about postsecondary affordability, access, and completion. This post provides a brief context of the research and headlines that have helped shape our thinking on these issues as they relate to Black students. First, we’ll talk about the disproportionate student debt problems that Black students are facing. Then, we’ll discuss some possible explanations for these obstacles. We have also conducted a brief summary of these 10 sources, for your reference.

The Problems

Significantly fewer Black students graduate without debt.

There’s an alarming relationship between degree attainment and larger amounts of debt for Black students. A study by The American Council on Education (ACE) found that about 30 percent of all 2015–16 bachelor’s degree recipients graduated without debt, but only 14 percent of African-American graduates could say the same. The average debt of Black graduates is around $34,000, which is higher than any other racial or ethnic group1.

Additionally, only 19 percent of African-American master’s degree recipients completed their degrees without borrowing, with 16 percent borrowing $75,000 or more. Compare that statistic to the 43 percent of white master’s degree recipients who avoided borrowing altogether, with only 7 percent borrowing $75,000 or more2. And after graduation, the Black-white disparity in loan debt triples3, according to research by Judith Scott Clayton and Jing Li.

Black students default at a higher rate.

Low-income students, Black students, and students earning four-year degrees at for-profit colleges are more likely than their peers to take out higher education loans. They’re also more likely to borrow larger sums of money, and they’re more likely to default on their student loans. As many as 70 percent of Black borrowers may eventually default. This is highly concerning when compared to the 4 percent of white students who default4,5, and default rates for Black students are not falling when looking at the data over time6.

Women have more student loan debt, and Black women have the most.

At the intersection of race and gender, the data shows that women hold almost two-thirds of the outstanding student loan debt in the United States, and black women have the highest student loan debt of any racial or ethnic group7. A profile of Black women and student debt in the Detroit area highlighted issues such as childcare, lack of resources at the high school level, and lack of employment opportunity after college as challenges Black women face when paying for college8.

The Possible Explanations

Disproportionate enrollment in for-profit institutions

Researchers point out that student debt inequality may be due to Black students disproportionately enrolling in for-profit institutions9. For-profit institutions are often the focus when discussing the issue of Black student debt due to their possible predatory actions. As Victoria Jackson from The Education Trust noted in The Washington Post10,

At the same time, public policy must protect students from predatory institutions that misuse federal and state financial aid or defraud students by providing an education that isn’t worth their time and money and may leave them with debt and little to show for it and little chance of paying it back.

Some argue that Black students enrolling in for-profit institutions at a higher rate does not justify blaming for-profit institutions for the Black-white student debt gap. When discussing educational options for Black borrowers, Jason Delisle of American Enterprise Institute argues11, “Why imply that black students would be better off not going to graduate school at all rather than a for-profit school if a lack of good data means we can’t determine which is the better choice?”

The intersection of race, income, and post-college decisions

Black families have less wealth than white families due to systemic inequalities. Student loans are one of the few attainable options for Black students and their families to finance a college education. A case study by Dominique Baker found the relationship between undergraduate debt and post-college decision-making is partially explained by the themes of “timing and structure of information, family as a source of knowledge, comfort with the amount borrowed, and the realities of postbaccalaureate decision-making.” A study by the Center for American Progress highlighted that diversity in the teacher workforce is also significantly affected by high amounts of student debt for Black teachers, as their salaries are not aligned with their debt amounts12.

Overall, there are more vigorous policy conversations regarding student debt and race happening every day. Solutions such as targeted financial literacy programs or stricter regulations on college costs can offer a way to address the Black student debt issue13. While the issues are far from being solved, policymakers and researchers should continue to frame discussions about student debt in the context of group differences in order to make more targeted and nuanced policy solutions.


About the Author

An image of Alyse Parker.

Alyse Gray Parker, Graduate Fellow, Academic Year 2019-2020
Ms. Gray Parker is currently a third-year Ph.D. student at The University of Texas at San Antonio in Educational Leadership and Policy, with an emphasis in higher education. Her current research interests include higher education policy, access, equity, and affordability issues, and understanding how special-mission institutions such as minority-serving institutions and land-grant universities have a role in the success of underrepresented student populations. Previously, Ms. Gray Parker interned at the Lumina Foundation as a policy intern through the Archer Fellowship program and as an accessibility specialist at Trinity University (San Antonio, TX).

She earned her bachelors of arts degree in psychology and master’s degree in school psychology from The Ohio State University.