As the recession continues into the fall semester, Vanderbilt shows no intention of forgoing its expanded financial aid policy in the face of the economic downturn.

On Oct. 1, 2008, Vanderbilt announced its expanded financial aid program, which replaced student loans with grants in financial aid packages. It was the final step in a debt-reduction initiative that began in 2001 to gradually reduce the amount of loans in financial aid packages.

Eighteen months prior to its announcement, the university decided to completely eliminate loans from need-based financial aid awards beginning during the 2009-2010 academic year. Through existing funds, institutional reallocations and Opportunity Vanderbilt, a scholarship fundraising effort with a $100 million goal that was created to sustain the new financial aid initiative, the university prepared to implement the program.

Vanderbilt is one of only 16 colleges and universities in the country that has removed loans from financial aid packages for all undergraduate students who qualify for need-based aid, according to FinAid.org. In fact, Vanderbilt and Davidson are the only colleges in the South that have no loan policies for all undergraduates qualifying for need-based aid.

Earlier this year, a news release from Vanderbilt News Service announced a 16.5 percent ($600 million) loss in Vanderbilt’s endowment. Although its endowment per student was among the lowest of the schools that have comparable no-loan policies, according to the Chronicle of Higher Education, many universities with much higher endowments per student, including Massachusetts Institute of Technology, Rice and Notre Dame, have yet to adopt such policies.

“When barriers to a Vanderbilt education can be reduced or eliminated, every student benefits from a learning community that includes talented, qualified individuals from all backgrounds,” pamphlets from the financial aid office read.

Douglas Christiansen, vice provost for enrollment and dean of admissions, said the program has put Vanderbilt at the forefront of financial aid policies.

“With Vanderbilt's most recent expanded aid initiative to replace all need-based loans with grant assistance, we are now among a very small group of institutions across the entire nation to provide such assistance while remaining need-blind in our admissions decisions and meeting the full need of all eligible students,” Christiansen said.

Almost all schools advertise a commitment to diversity, but by implementing the expanded financial aid program, Vanderbilt tries to show it. More Vanderbilt students needed financial aid this school year, due to both an increase in undergraduate enrollment and economic conditions.

And the university shows no sign of changing the expanded aid system.

“Although we cannot offer an absolute future guarantee in that regard, the university does not anticipate any changes in that commitment,” Christiansen said. “Students have nothing to be nervous about.”

The existing funds that had been saved in preparation for the implementation of the policy, along with institutional reallocation and the $57 million Opportunity Vanderbilt has already raised to support the expanded financial aid program, will be sufficient to support the continuation of the new financial aid initiative, Christiansen said, despite the endowment loss.

Due to the economy, many schools have been forced to reduce their financial aid, Christiansen said. However, Vanderbilt has no intention of making any changes that will negatively affect students’ financial aid packages, Christiansen said, especially for students who are already enrolled.