LRAPs can provide innovative solutions for students and institutions

This blog summarizes the key takeaways from our fiscal resiliency podcast, episode 13.

“Can I afford college?” is a common concern among students after high school graduation and is something that may keep them from attending a college or university of their choice within the timeframe they desire. This trending – and at times, daunting – topic of affordability consistently comes up in higher education board and leadership meetings, as well as conversations we have with institution leaders, especially when discussing current challenges related to enrollment and retention.

In Baker Tilly’s recent Higher Ed Advisor fiscal resiliency podcast, Drew Whipple, associate vice president for enrollment at MidAmerica Nazarene University (MNU) and Peter Samuelson, president of Ardeo Education Solutions (Ardeo), joined us to discuss an innovative solution that helps give students access to higher education within the context of affordability: loan repayment assistance programs (LRAPs). Our discussion emphasizes how institutions can provide LRAPs to students to enhance their ability to attend an institution and complete a degree program within their financial means. This program also has the potential to offer increased institutional resiliency as it strengthens retention and completion outcomes, which have a compounding impact on enrollment, and ultimately, fiscal results.

Giving access to higher education and supporting the MNU mission

Like many colleges and universities, MNU was witnessing enrollment decreases. Prior to introducing LRAPs, the institution’s enrollment had dropped 13% year over year, and the institution had significantly increased its discount rate as a result. MNU began investigating creative solutions that would address the issue of affordability to help students and stave off additional enrollment declines with significant impacts on the institution’s financial position. Whipple had prior experience and familiarity with Ardeo’s LRAPs and the positive impacts the program could offer MNU. Most importantly, Whipple understood the alignment between programs like LRAPs and MNU’s mission of allowing its graduates to “pursue their passion, not a paycheck.”

Oftentimes, after the excitement of receiving college acceptance letters, enthusiasm can become dismay when students receive their financial aid award and realize the significant costs that they or their families will assume. Students and their families may deliberate if higher education is simply an unattainable dream, or a dream deferred. In another scenario, students may anticipate suboptimal earnings potential post college graduation due to their pursuit of certain career fields, the prospect of unpaid internships or initial job offers at minimal pay levels. In these situations, students, graduates and families worry about their ability to repay student loans. Samuelson points out, that LRAPs have made all the difference for institutions like MNU because the program transforms the college affordability-related enrollment hesitancy into a “yes.”