Colleges promote debt literacy, aiming to cut down on loan defaults

Colleges and universities are teaching students about debt and even offering relief in order to cut down on student loan default rates, according to The Hechinger Report.

Institutions of higher learning implement such programs because higher student loan default rates reflect poorly on the school, according to CNN.

Syracuse University offers grants at an average of $5,000 to $7,000 per semester to students it deems to be overborrowing through private loans, according to The Hechinger Report. Students who benefit from the program attend courses on managing finances once every semester until they graduate.

Another program being tested in several states, Aid Like a Paycheck, doles out financial aid in smaller sums every two weeks.

City Colleges of Chicago increased the amount of paperwork needed to apply for loans and enlists students in financial advice seminars. Out of the 120,000 who attend there, fewer than 100 now take out private loans.

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