A new needs-based microlending program at UNM will allow students to pay back their loans by doing well in school.
UNM will collaborate with the New Mexico Educators Federal Credit Union on a program called “Powering Success: Micro Aid for Educational Achievement,” which will aid students who plan to drop out of school because of their financial situations, said Robin Brule, vice president for community relations at the credit union.
And Brule said loans can be forgiven if a student maintains good grades, although it has not been determined the exact amount that this entails.
“We don’t have all the milestones in place,” she said. ”But in theory, if a student continues to stay enrolled and continue to pursue degree completion that there would be specific benchmarks put into it that would impact their repayment.”
UNM created the initiative after it received the $100,000 Catapult Award in July from the Public Strategies Group, a Minnesota-based organization, to continue the University’s “Powering Success” program, Brule said. He said the grant provides assistance for change initiatives and management planning programs.
Through the program, UNM will back loans to students who show urgent financial need and will not take into account applicants’ credit scores, according to a report by the Albuquerque Journal.
But applicants will have to provide their concrete plan toward graduation. Approved applications will be sent to the credit union, and successful recipients could receive amounts ranging from $200 to $5,000.
Brule said students who join the program will be required to take courses to learn how to manage their finances.
“Access to this funding will also come with a complete in-depth financial capability program that not only provides students with an in-depth knowledge and meets them where they are, but also gives them tools and resources to make sure that they’re being economically stable so that they can continue to succeed in education,” she said.
Brule said the University encourages departments to communicate with each other to help students find financial help. However, if all other available on-campus resources are unable to address their financial needs, students will be directed to “Powering Success.”
“If there is no other type of resource that could help a student with what they’re experiencing, they will be triggered to apply for this,” she said. “The goal is to make sure the students are accessing the resources that are available to them.” Funding for “Powering Success” is an investment in UNM’s students, Brule said.
“The funding is coming to UNM to really help support student retention and achievement rates,” she said. “It’s a great investment of their resources given some of the predicaments students have where it impacts their ability to maintain in school and complete a degree.”
Even though the program does not have a specific launch date yet, it is set to start this fall, Brule said. But she said that because of the University’s problem with students’ retention rates, it plans to have “Powering Success” up and running as soon as possible.
“We’re hoping to have the program available to students midsemester,” Brule said. “We’re hoping that we’re mitigating a student’s need to drop out of school and that the financial capability will stabilize students to create an opportunity where they won’t seek that kind of aid more than once.”
Brittany Scanlon, a senior, said her scholarships and loans have helped her pay for school books and housing.
“Loans have helped my stay in school by helping to pay for my books, housing, and food without having to work full time, allowing me to focus more on my classes,” she said.
Naomie Germain, a junior at UNM, said she has a subsidized loan, and that her loan has allowed her to stay in school. She said reducing students’ stress about how to repay loans can help them in school.
“I’m very nervous about having to pay them back,” Germain said. “I know that my credit will affect me for the rest of my life and paying my loans back plays a big part in that.”