New York’s Houghton College Announces LRAP for All!
November 15, 2013

We wrote a couple of weeks ago about more colleges adopting Loan Repayment Assistance Programs (LRAP) to give students that must borrow to attend some peace of mind. In case you don’t know, LRAPs are programs that promise to pay your loan payments for you if you cannot find work that pays enough to service your loans. LRAPs at law schools are fairly common but in other university settings, not so much. That’s what makes New York’s Houghton College’s announcement so intriguing.

What’s been an issue (to our way of thinking) with many LRAP programs is that the recipients are limited. Some universities offer LRAPs only to fence-sitters to encourage them to matriculate at the college or only to law school students. But Houghton College is offering all incoming students access to LRAP benefits beginning with the Freshman 2014 class.

Here are some of the highlights of Houghton’s LRAP program:

• Must be a US citizen or eligible non-citizen (under Title IV regulations)

• Must graduate from Houghton

• Must work at least 30 hours a week earning minimum wage or higher

• Most work in the US

• Must earn less than $38,000

• Eligible loans include federal, private and parent PLUS loans

Houghton College launched new LRAP

Houghton College has launched a new LRAP. Image source:

One question is why the job requirement? What about those that are unemployed and can’t get even a minimum wage job? In some (admittedly rare) instances, unemployment may be so rampant that it’s not possible to get a job at all – at any wage. These borrowers would be left out in the cold by this (or another similarly-designed) LRAP.

Average student loans for recent graduates is close to $27,000 but is slightly less than average at the 130 year-old private Christian college. Houghton was ranked in the top 4% of colleges in the country according to Forbes magazine.

Marianne Loper, Director of Student Financial Services for Houghton says, “While a Houghton student graduates with an average debt load of about $5,000 less than the national average, Houghton still sees this program as a significant and important investment to make on behalf of our students.

The agony of unmanageable student loans

The agony of unmanageable student loans. Image source:

Houghton’s news is good for incoming freshman, but this is also not a school that has a prevalence of graduates struggling to make a living. It is for-profit colleges that put students at greatest risk for non-payment of student loans, not smaller private schools like Houghton.

Many for-profit institutions have default rates hovering around 30% and don’t graduate an impressive percentage of students. Yet these schools consume a large share of Pell Grants and student loans without optimizing the benefit for students.

It would be great to see more colleges establish LRAPs – perhaps this could become a condition of ongoing access to federal loan and grant funds… Only when universities have as much skin in the game as the students borrowing to attend will the student loan crisis achieve parity and be prime for a sea change.

Sign up for’s free student loan management tool to track and optimize your debt. Read our blog for tips on dealing with debt and repayment strategies. And be sure to browse our Student Loan Help Center for How To Guides on a variety of relevant topics.