Marquette University allegedly provided preferential treatment to wealthier families.

A report from think tank New America examined more than 20 years of financial aid data at more than 300 selective colleges and universities. Its report centers 41 universities, 23 of which are private universities and 18 are public flagship and research institutions. Its findings were that students from low- and lower-middle-income students were encouraged to take out Parent PLUS loan debt that would be challenging to pay back.

“We went from a system where the point of student aid was to help students who could not afford to go to college, to one in which they’re trying to figure out exactly what price to bring you in,” author Stephen Burd said, according to WPR. “Almost like an airline does when they’re selling their seats.”

The 41 universities offered $2.4 billion in financial aid to students who weren’t in financial need in 2023, according to New America. Additionally, $2 out of every $5 spent on institutional aid went to students who didn’t need government aid to earn a degree. However, more than 32,000 families of Pell Grant recipients who graduated or left the listed schools had a median Parent PLUS loan debt of nearly $30,000 each, meeting or exceeding the earnings of most families of Pell Grant recipients in a year, the report stated.

“One way for a college to use financial aid to increase its ‘net tuition revenue goals’ is to provide discounts to a larger number of wealthy students, who, even with the rebates, will ultimately pay more than less advantaged students and have families who may be willing to make substantial donations to the institution,” the report mentioned. “But another way is to steer low-income students’ families to Parent PLUS loans. After all, Parent PLUS loans are easy credit colleges can offer families to cover funding gaps. The loans are readily available, so long as potential borrowers do not have bad credit. And because there are no consequences for the schools if borrowers can’t repay the debt, college officials don’t have to worry about how hazardous these loans may be for students’ families.”

Marquette University was among the 41 universities listed. Of Marquette Pell Grant recipients who graduated between 2020 and 2021, 34% took out Parent PLUS loans, and those families owed an average of $30,089 on the loans, according to the report. The university also dispersed an average of $22,000 in grants to those who are not in financial need, WPR reported.

On the university’s website, there is a statement that reads, “At Marquette, we understand that a college education is a significant investment for our students and their families. We remain committed to making a Marquette education accessible for all: 99% of our undergraduate students received some form of financial aid last year, and we distributed more than $170 million in scholarships.”

A spokesperson for Marquette University told WPR that the PLUS loan option is a separate option given to families as they consider their choices.

“No family should take on debt they cannot repay,” the statement said, per WPR. “We counsel families on pursuing other options before borrowing to allow due diligence on their part.”

The statement continued, “Part of our commitment to affordability is a strategy to reduce net cost for low- and middle-income families, and we are working continuously with our generous benefactors to increase scholarship funds so we can award even more scholarships to those in need.”

Other universities mentioned in the report included Temple University, Kent State University, Rowan University, George Mason University, and St. John’s University.

The report also stated the list did not include Historically Black Colleges and Universities.

The full ramifications of the Parent PLUS loans won’t be revealed until later, as a result of frozen payments during the COVID-19 pandemic and under the Biden administration, which did not collect on defaulted loans, the New America report noted.

Looking ahead, New America also predicted a “tsunami of student and parent loan defaults.”