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Originally Posted by Cynthetiq
I didn't qualify for student loans as my parents made just above the cut off. My parents miscalculated how much to save, so I worked and paid most of my college myself. I didn't ever graduate as I got many well paying jobs offered to me to stop going to college.
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In this article, they're not talking about federal loans; they're talking about private loans. A FAFSA (wherein your parents' financial information is relevant) is irrelevant to getting a private loan. The only thing a person needs to get a private loan is either a) a good credit history or b) a credit worthy cosigner. They can borrow as much as they need up to the cost of attendance. The school plays nearly zero role in private loans; they only provide a list of lenders and disburse the check the loan company sends.
Most people do not pay for their entire college education with private loans; rather, they use private loans to make up for what financial aid (which can be a combination of grants [state and federal], subsidized loans, and unsubsidized loans.
I would only be really worried about the private loan market if Sallie Mae and Nelnet said they weren't lending to certain institutions; they're the industry leaders in this market. The other thing that complicates this is that Sallie Mae often lends to students using other lenders--meaning the loan is actually from, say, Chase, and Sallie Mae is just the middleman(though they usually buy these loans down the line--this is what happened to my student loan).