The data are clear: Unlimited Grad PLUS loans led to additional lending and higher tuition, but did not increase access to programs or for underrepresented groups and did not increase degree attainment rates. In fact, a 2023 report from the National Bureau of Economic Research found the following:
Graduate PLUS…did not improve access to existing programs overall or for underrepresented groups. Nor did access to additional loan aid result in significant increase in constrained students’ persistence or degree receipt…Federal borrowing and prices increased.
The pattern is unmistakable. A wide range of sources confirm that unlimited Grad PLUS loans enable institutions to chase revenue while leaving students worse off, amassing large amounts of debt for graduate degrees that don’t pay off.
With growing graduate school enrollment and rising costs, the spending on these graduate loans has led to substantially higher debt levels for graduate borrowers. Graduate loans will soon account for nearly half of all federal loan dollars, yet many programs fail to offer a return that justifies the cost.
The good news: Congress can address this problem while still ensuring opportunity for students to access a graduate program of their choice. Policymakers should set a limit on Grad PLUS loans that account for varied earnings across fields of study. This would preserve broad access to high-return professional fields while limiting borrowing to amounts that students can realistically repay.
“Brown announced plans to expand its online master’s programs in the hopes of reducing its $46 million structural budget deficit. An increase in master’s programs would allow the University to ‘diversify our revenue base and profile, which is important for financial health.’”
– The Brown Daily Herald | January 23, 2025
“Master’s degree programs, with their high costs and uneven benefits, are among the worst performers:nearly half fail to pay off.”
– Foundation for Research on Equal Opportunity | May 8, 2024
“USC deliberately deceives students by claiming that its online MSW program is the ‘same’ academic program as USC’s long-standing on-campus program other than in format, including by charging the sam every high tuition (over $100,000) for both programs.”
“In its partnership with 2U, USC turned its online MSW program into a large-scale diploma mill.”
– Project on Predatory Student Lending | November 10, 2023
“Aurora [University] students graduate with an average of $27,588 in debt, around six times less than the median debt of students in Northwestern’s [master’s of counseling] program, $153,657.”
– Washington Monthly | August 25, 2024
“At the Columbia University Graduate School of Journalism, tuition for the 9½-month program rose by 26%, adjusted for inflation, to $70,300…Columbia’s [journalism school graduates] earned a median of $49,900.”
– Wall Street Journal | September 10, 2021
“Grand Canyon recruited students with false promises about tuition costs, then padded the pockets of their for-profit affiliates with the extra charges students were forced to pay to secure their degrees.”
