Hispanic families face difficult circumstances as college debt rises

Editor’s note: This story first appeared on palabradigital news site of the National Association of Hispanic Journalists.

Rich Tenorio

Iliana Panamegno wanted to get a master’s degree in social work, just like her mother. In order to afford herself admission to Boston University’s School of Social Work, she moved back to her parents’ home in Malden, Massachusetts. Panamegno took out graduate loans under her own name so as not to burden her parents financially and risk delaying their retirement, a move that came at a cost.

Today, the amount of payments on federal and private loans in Panamegno is about $ 1,500 per month. Her monthly payment could increase this year due to the Biden administration’s three-year pause on federal student loan debt collection, which is due to end either September 1 or 60 days after the debt relief lawsuits are resolved. (These challenges reached the Supreme Court.)

“The pause on student loans (repayments) has been a huge relief,” Panameno said. “I feel like I’m in the space to save more.” However, she wonders about her financial future once the federal pause is lifted and whether things like retirement will be possible.

Hispanic Families Face Rising College Debt

Iliana Panameno, Communications Specialist at GreenRoots, in her office at Environmental Justice Organization headquarters in Chelsea, Massachusetts. Photo by Laura Carmen Arena for palabra

She knows that things could be worse. In Boston’s hot housing market, she lives for free with her parents. She helps them pay utility bills and send remittances to relatives in El Salvador. She also manages to fulfill her dream of holding an organizational job as a communications manager for GreenRoots, an environmental nonprofit based in the working-class, predominantly Latino city of Chelsea.

Last year, Panamegno and her sister felt financially secure enough to try to buy an apartment together. One purchase failed. Then mortgage rates rose, freezing their plans. “I have a good job, a well-paid job,” Panameno said. But she couldn’t imagine buying a house alone, given her credit burden. She also hears her friends’ concerns about loans blocking their life plans. “They’re not sure they can afford to have a family because of student loans,” she said. “Will we work forever to pay them back?”

Hispanic Families Face Rising College Debt

Iliana Panamegno and family. Photo courtesy of Iliana Panamegno

As of February 2023, 43.5 million student loan borrowers nationwide owed a record $1.75 trillion in collective federal debt. fastest growing student body.

Overall, between 18 and 20% of outstanding borrowers in the US are Hispanic, according to Laura Beamer, a lead higher education finance researcher at the Jain Family Institute, an unbiased research group. “We can only assume that more Hispanics will be borrowing in the future than they are now,” Beamer said.

Beamer’s colleague, Edward Nilay, a data scientist, said there could be dire consequences when the pause in federal credit ends. “It will be more difficult to stay in mortgages,” Nilay said, adding that it will be difficult for some borrowers to decide “how much debt they are going to pay off first.”

“Lack of resources — not just financial, but lack of knowledge — is really at the core of the problem,” said Jacqueline Piñero, who leads uAspire, a national nonprofit in Boston that advises marginalized communities about college. Of the population served by uAspire, 41% are Hispanic, representing about 4,000 borrowers per year.

“Especially for first-generation students,” Piñero said, “it is difficult to find someone else in the community who has already walked this path before, who can help reduce this knowledge gap, find options and opportunities for continuing education after high school.”

Panameño does have such a role model: her mother, who came to the US from El Salvador on a work visa and received a master’s degree in social work from Boston College. However, having a parent with a degree did not save Panameño from student loans. For her undergraduate studies, Panameno headed to Union College, a private Seventh-day Adventist institution in Lincoln, Nebraska. She said that her family was referred to a PLUS loan with a high interest rate. The Federal Loan, administered by the Department of Education, is provided to parents of undergraduate and graduate students.

Hispanic Families Face Rising College Debt

Students walk around the campus of Boston University on Commonwealth Avenue on a cold February day. Photo by Laura Karmen Arena for palabr

“Even though I have a parent who was able to study and graduate from college,” Panamegno said, “I thought there was still not enough information about how the process works.”

For those who can avoid high loan balances, there are other concerns. Ruth Alcantara, Panamegno’s GreenRoots colleague, attended the University of California, Santa Barbara (UCSB), which offers a tuition discount for in-state residents. This allowed Alcantara to stay close to his immigrant Guatemalan family in Los Angeles. Guatemalan identity is important to Alcantara, who keeps a plaque commemorating the genocide of Mayan indigenous communities in Guatemala on her desk at GreenRoots.

To further narrow the funding gap, Alcantara worked multiple jobs at UCSB during the five school years from 2017 to 2022, including night shifts at the school library and telecommuting during the pandemic. At one point, their work schedule was almost equivalent to a full-time job.

“If there was one thing my parents always told me, it was not to take on too much debt for going to school,” Alcantara said. “I had to sacrifice something by working hard – my physical well-being, a little bit of my mental well-being. It was a constant routine – work, school, sleep, then work, school, sleep. Sometimes I didn’t even sleep.”

Hispanic Families Face Rising College Debt

Ruth Alcantara prepares for a virtual meeting at GreenRoots, a non-profit environmental organization based in Chelsea, Massachusetts. Photo by Laura Carmen Arena for palabra

Hispanics who borrow money for higher education have mixed feelings about loans. Anna Rosario, the daughter of Dominican parents with a strong religious faith, was the first of nine siblings to attend college. She attended an all-girls Catholic high school in the Bronx, where she said there was little incentive to attend the more accessible City University of New York (CUNY) system. “That would probably be the most affordable tuition fee,” Rosario said. — I didn’t do it.

Instead, Rosario applied to Manhattan College, a private Catholic liberal arts university in the Bronx. “It was normal to go to a private institution,” she said. “I just went with the flow.”

Tuition at Manhattan College is $46,100 for the current academic year and $23,050 for a semester. The CUNY system costs $6,930 per year for New Yorkers enrolled in a full-time, four-year college program. At first, Rosario tried to pay tuition by semesters, but this led to late registration for classes. Then one of Rosario’s sisters also went to college, further complicating the family’s financial situation. “It became clear that this was a fight for my family,” Rosario said.

Her family took out additional private loans to enable Rosario to sign up for classes on time. “I just wanted to go to school and not worry about money,” Rosario said.

Christopher Rivas knows this opinion firsthand. Growing up, he dreamed of becoming an actor. To afford the California Institute of the Arts, his financially needy parents together signed his student loans for what he calls “huge sums.” Looking back, Rivas said, “These were people who didn’t understand what they were reading.”

Hispanic immigrant families may also have trouble understanding loan documents filled with unfamiliar financial terms. Therefore, experts recommend more financial education at the high school level targeted at immigrant communities. “Financial literacy programs for Latinos students and families should be available,” said Erica Romero, vice president of educational policy and advocacy for Latinos for Education.

Some states are taking steps in this direction. Last year, the list of states with compulsory financial literacy in the school curriculum grew to 14 states, the latest being Michigan. “The more general financial literacy that can be taught in places like public high schools and community centers, the better off Latino communities will be when they get to this point in their lives,” uAspire’s Piñero said.

Six months after graduating from the California Institute of the Arts, Rivas had to pay back a loan that was more than double his rent in Los Angeles. Having exhausted his possibilities, he found a non-standard solution – he entered graduate school. program of the European Graduate School in Saas-Fee, Switzerland, titled Expressive Art: Therapy, Coaching, Counseling and Education, Conflict Transformation and Peacebuilding. Generally, graduate students can qualify for federal loan deferrals. Rivas delayed his student loan payments by taking out a student loan from the US government.

Today, Rivas works as an actor, starring in the TV series Call Me Kat. He still pays off his loans. The monthly amount is more than his rent, but he appreciates having the funds to do so.

Rosario, who graduated from Manhattan College in 2020, now works on the other side of the table as a college admissions officer. She counsels the youth in her local parish, many of whom come from immigrant families. She cautions students against taking out the full amount of loans offered if they only need a portion of it and have other means to cover the balance. Meanwhile, she knows that many students have to translate loan documents for their parents. She wants colleges and universities to provide financial aid classes in languages ​​other than English and provide translated documents.

“The skills I have acquired while working in the admissions office are helping not only me, but also my community,” said Rosario. “It’s a very difficult process, especially when it comes to first generation students and students of color in general. I try to help families whenever I can.”

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Rich Tenorio writer and editor whose work has been published in various media. He is a graduate of Harvard College and the Columbia University Graduate School of Journalism. Tenorio is also a cartoonist.

Laura Carmen Arena Argentine-American writer and photographer. Her photographs have appeared in local and international publications. Having moved from New York to Cambridge, Massachusetts, she specializes in street and documentary photography, writing fiction and non-fiction on culture and the environment. She studied literature at New York University and fine arts and writing at Harvard University, where she also worked as a research assistant, photographer, webmaster and assistant director of multicultural affairs. Laura is an experienced yoga and meditation teacher and is working on a novel and multimedia projects dedicated to healthy living.

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