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Study: Student Borrowing May Lead to Academic Success in Community College

Inside Higher Ed

Loans may be one solution for helping students afford college and increase achievement, but grants that don't have to be repaid is another. The researchers are working on a new study that examines the academic effects of federal loans versus grant aid and agree that the effects of the federal Pell Grant may be stronger on academic performance, Marx said.

“There is a mountain of research showing grant aid or need-based aid certainly increases the chances of low-income students graduating from college,” said Mark Huelsman, associate director of policy and research at the think tank Demos. “If our goal is to maximize the amount of credits students are taking or maximize their attention to academics, then it’s still pretty clear that grants are better than loans, but student loans, if they are the only or last resort for students, can be beneficial.”