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A Study of Student Loans and 
ness loaning have been remarkably successful in administering Student 
loans. There is no more risk involved in Student loans than there is in 
commercial loans, where as great care is taken in the selection of the risks 
and the funds are administered in a firm business-like manner. 
13. Past Experience of Institutions with Loan Funds 
The experience of institutions in general has not been encouraging. 
However, many institutions have been successful in the administration of 
their loan funds. 
Taking the entire group, the proportion of overdue loans is far from 
alarming if some allowance is made for the inadequate method of adminis 
tration in many institutions. 
14. Selecting the Risk 
No set rules can be established to guide those who are to decide which 
students are to be granted loans. The student’s present needs, future 
ability, and willingness to pay are the deciding factors. His present needs 
can be determined by the analysis of his Statement as to his present financial 
circumstances. His future financial success is hard to estimate, but if a 
student has a reasonable amount of intelligence, initiative, good health, and 
possesses integrity and reliability, there is no reason whv he should not get 
a loan if he needs the money. By not loaning more than the Student will 
be able to repay, by charging a fair rate of interest, and by adopting some 
form of group guarantee, Student loan funds should not only be kept 
intact, but should increase as any productive investment. 
15. Size of Loan 
There is at present a wide Variation between the amounts of money 
that the different institutions will loan to one student. In spite of the fact 
that only two institutions (out of 153 reporting) extend loans to the 
amount of $1,000 to one student, this would seem the soundest practice. A 
student who is worth helping at all should be “seen through” and it is 
not likely that less than $1,000 will be sufficient to see him through four 
years of College life unless it be for emergency purposes. The amount of 
the loan should also be adjusted to the cost of living and the cost of educa- 
tion in the community. 
Also, if a student is loaned money at all, the amount should be suffi 
cient to relieve him of his financial burdens to such an extent that he may 
do justice to his academic work without impairing his health. Two thou- 
sand dollars should not be too much of a loan to extend to a student who 
has good health, is reliable and ambitious, and shows signs of a promising 
future.