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A Study of Student Loans 
Loans in excess of this amount should be rare and made only after the 
most careful investigation. 
5. Interest.—Interest should be at the current commercial rate, gen- 
erally six per cent., starting from date of loan. 
6. Security.—The borrower should always sign a definite contract. 
In the case of revolving funds, loans should be protected by a group guar- 
antee. When a large number of loans are made annually, the group should 
consist of those borrowing in the same year; when only a few loans are 
made each year, the group may consist of several consecutive classes. 
Borrowers should be made to understand that it is a business transaction 
and will be treated as such. 
7. Repayments.—The loan should be repaid in installments beginning 
not more than one year after graduation or withdrawal from the institution. 
Not more than five years should elapse from date of loan before the first 
payment is made. An amortization plan can be used which includes 
interest, guarantee fund and principal, payments to be arranged in install 
ments of not less than five dollars a month or more than fifteen. 
8. Collections and Delinquencies.—A prompt and exact follow-up 
System should be used, with the same ethical considerations that would 
control a wisely conducted bank.