None
EN
Rethinking Predatory Student Lending
['Beth Akers']
American Enterprise Institute – AEI
We’re likely to soon be hearing cries of “predatory” lending practices from consumer and student advocates.
But despite the popularity of the term, there isn’t a universally agreed-on definition of predatory lending.
While this outcome may be undesirable, differential pricing is not, in itself, evidence of predatory lending practices.
The last facet of our working definition for predatory lending is whether a loan is made with the belief that it will be repayable.
Yet Grad PLUS was seldom criticized as being a predatory program despite it repeating the lending practice that fueled the Great Recession.