NEW YORK ( MainStreet) — In the age of Obama, black, Latino and Native American college students are more likely to attend schools that do not participate in federal student loan programs than their white peers. In Alabama, almost 64% of African-American community college students do not have access to federal loans , compared to over 34% of their white counterparts. In Tennessee, the proportion is 59% to 37%, black-to-white. That's because of a tendency for community colleges to deny their students access to federal aid.

These are some of the findings in a report released last week by The Institute for College Access and Success, or TICAS, which concluded that community colleges that don't offer access to federal student loans may be steering almost a million students toward riskier forms of credit to fund their educations. In many southern states, more than 20% of college students had no access to federal loans.

The issue is default rates and the risk they pose to other types of aid—and the consequences aren't limited to students categorized by race or who attend community colleges.

The Department of Education now tracks defaults at all institutions for people with federal loans for three years after they leave school, whether or not they graduate. All colleges must demonstrate that the percentage of loans in default must be under 25% for three consecutive years or under 40% for one year—or risk losing all federal student aid, including Pell grants for their students.

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Relatively few community college students have to take out loans to finance their education compared to other colleges and universities. Many students are able to cover tuition and fees with Pell Grants or other forms of aid . However, students who can't make it without borrowed money often resort to more risky alternatives, such as credit cards and subprime loans. Many students are able to cover tuition and fees with Pell money —which are cash grants, not loans that have to be repaid. The loss of Pell grants would be a significant hit in the community college space.

"Barring access to federal student loans doesn't keep students from borrowing," TICAS research director Debbie Cochrane told Inside Higher Education . "It just keeps them from borrowing federal loans, which are the safest option."

TICAS thinks colleges can work with borrowers to manage their debt and take advantage of federal rules that allow them to adjust their default rates to account for low levels of borrowing. Community colleges shouldn't resort to the nuclear option of blowing up access to federal loans across the board.

The relatively low cost of community colleges should be an opportunity to keep defaults low.