Incomplete Assessment of Student Lenders' 'Red Lining'
The U.S. Government Accountability Office said in a report Tuesday that it was unable to assess the extent to which providers of private student loans used non-financial factors -- such as race, gender or institution type -- to decide which students to loan to. The report, which was mandated by the Higher Education Opportunity Act, was requested by lawmakers concerned about reports that lenders were engaging in a form of "redlining": cutting back their lending or charging significantly higher rates to students from historically black or community colleges because they were assumed to be worse credit risks.
