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APPENDIX A 
EXPERIENCE OF THE HARMON FOUNDATION 
IN STUDENT LOANS 
Düring the three and one-half years of Operation in Student loans, 
the Harmon Foundation has passed from the uncertain shoals and depths 
of a rocky sea-coast of theory, hope and conviction, to the clearly defined 
harbor of certainty as to the practicahility of making business loans to 
College students with character as the basis of security. 
Within this period nearly one thousand loans averaging about $170 
have been made to men and women in forty-one affiliated Colleges. Of 
this number payments on approximately three hundred fifty have become 
due, which have been or are being liquidated in accordance with the 
arrangements provided for installment payments of $10 a month. The 
trend so far has shown conclusively that it is the plan of easy installments 
that appeals to the average Student borrower. While a few have antici- 
pated payments and made early settlement, thus cutting down the interest, 
the very large majority pay the required amount month by month. 
Repayment, of course, is the gauge by which the plan is being, 
and will continue to be tested. Now, well into the second year of repay- 
ments the litmus paper remains essentially blue. The reliability of Student 
character in connection with financial obligations is fundamentally sound. 
Experience has shown that the great need at present is systematic train- 
ing in promptness, and a healthy respect for due dates. Far too many 
of the borrowers have an idea that paying an installment at the end of the 
month is as satisfactory as having it in on the first when it is due. The 
Division of Student Loans considers, therefore, that a very important 
part of its work is the requirement of strict adherence to all details of the 
loan agreement as preparation for later contact with business organiza- 
tions that are operating for financial return rather than education and 
public Service. 
The Division of Student Loans was not started in a Superlative 
expectation that return on all loans would be one hundred per cent. 
perfect both from the point of view of money and time. Although for 
the sake of the individual borrower it was hoped that no one would fail 
to follow the conditions of his agreement, those who have slipped from 
grace, even temporarily, have unwittingly furnished the working material 
for the experimental laboratory in which to test and demonstrate the 
strength of the collection procedure.