As college tuition continues to soar, a recent report has brought attention to the financial practices of Marquette University, where wealthier families reportedly receive scholarships, while lower-income families are steered toward high-interest loans.
Marquette stands among 41 institutions highlighted by the progressive think tank New America in a recent report. The allegations suggest that these institutions are encouraging economically disadvantaged families to resort to Parent PLUS loans, while offering financial aid to students from more affluent backgrounds.
The report, released on February 12, states, “Each year, tens of thousands of low- and lower-middle-income families are encouraged to borrow hefty Parent PLUS loans they likely won’t be able to repay to send their children to selective public and private research universities.”
An analysis of Marquette University’s financial aid practices revealed that 34% of Pell Grant recipients who graduated or left between 2020 and 2021 utilized Parent PLUS loans, incurring an average debt of $30,089.
Conversely, the university distributed an average of $22,000 in non-need-based grants during the same period.
Pell Grants, intended for low-income students, do not require repayment. In contrast, Parent PLUS loans, which allow borrowing for the full cost of tuition, carry substantial risks due to their high-interest rates.
The study notes, “The cash-strapped families often have little choice but to take out these risky loans because these schools spend the bulk of their financial aid trying to lure affluent students to campuses to help them raise their rank and revenue.”
Marquette University’s tuition costs currently stand at $53,890, with total annual expenses, including housing and fees, ranging between $69,470 and $73,880, as reported on the university’s website.
Marquette claims that in the previous year, 99% of undergraduates received some form of financial aid, with over $170 million allocated in scholarships.
In response to the report, a Marquette spokesperson stated that no representative was available for an interview. However, the university emphasized in a statement to WPR that the PLUS loan option is presented distinctly in financial aid offers to ensure families are informed of their choices.
“No family should take on debt they cannot repay,” the statement reads. “We counsel families on pursuing other options before borrowing to allow due diligence on their part.”
The university also highlighted a Price-to-Earnings Premium report indicating that the median Marquette graduate recovers their college expenses through increased earnings in under three years, with this timeframe being even shorter for low-income students.
“Part of our commitment to affordability is a strategy to reduce net cost for low- and middle-income families, and we are working continuously with our generous benefactors to increase scholarship funds so we can award even more scholarships to those in need,” the statement added.
Interestingly, Marquette is the sole Wisconsin institution mentioned in the New America report.
Financial Aid Strategies and College Rankings
Research by Stephen Burd, who examined public records of over 300 selective colleges, reveals a prevalent practice known as “financial aid leveraging.” Colleges reportedly collaborate with consultants to determine the optimal financial aid packages required to enroll various student demographics without exceeding necessary expenditures.
Burd explained, “We went from a system where the point of student aid was to help students who could not afford to go to college, to one in which they’re trying to figure out exactly what price to bring you in. Almost like an airline does when they’re selling their seats.”
This competitive landscape pushes colleges to use financial aid as a tool to attract students with superior test scores or affluent backgrounds, as these families may contribute donations.
Peter Granville, of the Century Foundation, underscores the importance of understanding how colleges allocate financial assistance. He remarked, “This report argues that Marquette could have given families more grant aid, which would reduce their need for Parent PLUS loans. But the school didn’t.”
He highlighted that a third of Marquette’s Parent PLUS recipients also received Pell Grants, denoting lower-than-average incomes.
Effective July, income-based student loan plans will no longer be available to borrowers.
Granville noted, “If a parent borrows a loan that they can’t repay, they’re sort of stuck. Parent PLUS loans are a tempting source of revenue for colleges, because parents can borrow so much (with) them so easily without necessarily understanding the true cost.”
The report further reveals that many colleges on the list, including Marquette, possess substantial endowments, with the latter valued at approximately $1.13 billion as of mid-2025.
A similar analysis by the Wall Street Journal in 2021 on Baylor University led to the creation of a tuition-free program for families earning $50,000 or less.
The New America study considered both private and public universities, identifying the University of Alabama at Birmingham, where 64% of low-income students also borrowed through PLUS loans, as a top example.
While commending Wisconsin for its public universities’ absence from the list, Burd acknowledged the state’s efforts in providing affordable education. Wisconsin’s commitment is reflected in its “tuition promise” programs, aimed at covering tuition and fees for low-to-moderate-income residents, available at various institutions across the state.
Burd concluded, “Wisconsin, relative to the rest of the country, is more affordable, and they still have put a premium on helping financially needy students and families.”
