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CHAPTER VI 
THE ADMINISTRATION OF STUDENT LOANS 
The survey of Student loans made by the Student Loan Information 
Bureau during the past year and by the Harmon Foundation during the 
previous year shows that there is no uniformity in the administration 
of Student loans in the various Colleges and universities. In formulating 
policies for the administration of loans, it has not been possible to be 
guided by prevailing methods, for each institution seems to have a pro- 
cedure peculiarly its own. No two institutions are guided by the same 
set of principles. There exists no distinguishable trend of thought, no 
well worked-out policy making for a definite purpose or end. The 
administration of loans to students has never been given, nor is it given 
even today, the proper attention and place in the financial policies of 
higher education. 
In the working out of a policy for the administration of Student 
loans, it is desirable therefore to lift all that is best from the various 
methods in use and with this material construct a workable plan which 
will approach, as near as possible, the ideal. There is no “yard stick” 
with which to measure that which is best in the various plans. The selec- 
tion of the best elements from the different Systems in use must be made 
judiciously rather than scientifically and supplemented, where necessary, 
with theoretical conclusions. 
Methods of Administration 
Loan funds are administered in two ways: the restricted method, 
loaning the income from the fund only; and the revolving method, loan- 
ing both income and principal. Taking the institutions as a whole, there 
are many more funds administered under the restricted method than 
there are under the revolving method. These conditions do prevail not- 
withstanding the fact that of the 93 institutions which answered an 
inquiry sent out by the Student Loan Information Bureau, 69 replied 
that they favored the revolving fund. The replies are personal opinions 
of the iijdividuals who are familiär with and in most cases responsible 
for the administration of loans. The replies revealed opinions as follows: 
69—favored revolving fund. 
5—preferred restricted fund. 
1—no experience with revolving fund. 
1—doubtful. 
16—no answer.