The Student Loan industry has been hit hard during the current credit crisis. Some of their new conservative policies may remind you of that stuck-up girl who wouldn’t date you.

All of a sudden 2-year colleges and other community college schools aren’t good enough to be lent to. Are the students attending those and other ‘less competitive institutions’ not worthy of affording an education? According to many of the biggest banks (PNC, Citibank, JP Morgan, SunTrust) that’s exactly correct.

40% of America’s undergraduates are enrolled in community colleges. That’s 6.2 million of the total 14.8 million. Many of these students are using their local college as a stepping stone to a 4-year institution or are pursuing associate degrees for better career options. So what are they supposed to do when they can’t pay the bills? Resort to crime?

Here’s where the stuck-up bitchiness kicks in. According to an article about this in the New York Times yesterday:

Some loan companies have exited the student loan business entirely, viewing it as unprofitable in the current environment. By splitting out community colleges and less-selective four-year institutions, some remaining lenders seem to be breaking the marketplace into tiers. Students attending elite, expensive, public and private four-year universities can expect loans to remain plentiful. The banks generally say these loans are bigger, more profitable and less risky, in part perhaps because the banks expect the universities’ graduates to earn more.

Some may call it “simple economics”, or explain, “That’s capitalism, baby. We’re running a business not a charity here!” To them I say, point taken, but what’s next?

How about when they draw a line between private schools and state schools? Between Ivy Leaguers and non-Ivies? Pretty soon will Harvard doctorate candidates be the only ones eligible for a student loan? Besides, those nerds probably come from the wealthiest top 5% of the country anyway.

NYTimes: Student Loans Start To Bypass 2-Year Colleges, June 2, 2008