It’s been nearly a decade since I completed all the credits needed for my bachelor’s degree. That spring of 2013, I received an invitation to my graduation, along with directions for purchasing my cap and gown. But by then, I had already decided I would not attend.
Weeks earlier, my guidance counselor informed me that the university planned to withhold my transcripts and diploma because of a “financial hold” on my student profile. Though I’d received a scholarship and had taken out over $20,000 in student loans to finance my college education, it still wasn’t enough to cover the full cost of earning a four-year degree. I owed the university thousands for unpaid tuition and fees, and as a poor Black woman raised by a single parent, I knew I wouldn’t be able to pay off the debt in time for graduation — or at all.
I was mystified that the school had bothered inviting me to their graduation ceremony, even though I would have no way to prove I was a graduate. After years of hard work, my life was now on indefinite hold. I put off my dream of going to grad school. I avoided applying for full-time positions, working as a freelance journalist to avoid having to provide transcripts or my diploma to employers.
Then, surprisingly, I received a message from my university in October. They planned to release both my diploma and transcripts. I was finally going to be an official graduate.
I welcomed the news but also wondered: What had changed?
Stranded credits affect millions
Turns out, what I had faced is a widespread issue. According to a 2020 study by Ithaka educational support services, roughly 6.6 million students have “stranded credits,” a term advocates use to describe what happens when students cannot access their official records or transfer credits to another institution because of financial holds. According to the study, nearly all of American universities and colleges partook, or continue to partake, in withholding transcripts when students have a balance with the school.
Only in recent years have states passed laws forbidding the practice, including where I went to undergrad, New York, in June. Advocates note that by not allowing graduates access to their records, it makes it more difficult for them to get ahead and ultimately pay back the money they owe.
“This issue of transcript withholding was hiding in plain sight because it was how business was being done in universities and colleges all across the country were doing it,” said Winston Berkman-Breen, deputy director of advocacy and policy counsel for the Student Borrower Protection Center. “We had taken for granted that it was the way things had to be, which is true of so many injustices.”
Withholding transcripts hurt students of color most
Stranded credits disproportionately impact lower-income students, minorities and those who attend community college — all of whom are more unlikely to be able to clear their debt burdens. An analysis of 1,000 State University of New York students who had outstanding debt found that zip codes with densely Latino or Black populations have eight and 10 times, respectively, more transcript withholding cases than zip codes with less dense Black and Latino populations.
Alexzia Shobe, a 25-year-old Black journalist, was surprised when the New School withheld her transcripts when she tried to transfer schools. “I had faith that due to receiving a scholarship and having been a great student, they may have offered me more financial aid or alternative repayment options,” she said. “But I had no such luck. It’s been heartbreaking.”
Advocates say transcript withholding creates a vicious cycle where students cannot afford to pay the fees to obtain their transcripts and diplomas, stopping them from transferring to four-year schools, going on to graduate programs or getting gainful employment.
“If you go to the hospital and you have a baby, you still owe the hospital for the delivery and all of the medical services, but you get the birth certificate — no one can hold that hostage,” Karen Cody-Hopkins, a Colorado student loan lawyer explained. “That analogy seems to really resonate with people because transcripts are not just a piece of paper that are just about payments — it is the entire record of a student’s academic experience within an institution, and having the official record is required and important to establish credentials to get a job or continue education.”
A tide change to ban the practice
In 2019, California became the first state to pass legislation to abolish the practice of transcript withholding. Since then, other states have followed, including Colorado, Maine, Minnesota and New York. The movement has also spurred colleges and universities to eliminate these policies without being forced to by law. For example, the Craig Newmark School of Journalism at the City University of New York eliminated its policy on transcript withholding in August 2021, months before the state outlawed the practice.
“I see this as an equity issue,” Andrew Mendelson, associate dean of Craig Newmark School of Journalism at the City University of New York, said via email. “Not harming career or additional educational opportunities for students and alumni due to financial hardship.”
The fight to condemn stranded credits has even reached the federal level. “To emerge from the pandemic even stronger, institutional leaders must embrace long-term change,” U.S. Education Secretary Miguel Cardona said during an online conference of financial aid administrators in December 2021. “That means evaluating long-standing institutional policies that block retention and completion for our most underserved students, such as enrollment and transcript holds for students with unpaid balances.”
In September, the federal Consumer Financial Protection Bureau called it “abusive” for colleges to withhold transcripts from students as a way to make them pay their loans. The agency found that many schools continued to withhold records, even after students attempted to settle their bills by entering into payment plans. It also noted that attempting to collect on debt while holding student credentials hostage has proven to be entirely ineffective.
“Americans must exercise their right to their educational data to obtain a job or transfer schools,” said CFPB Director Rohit Chopra. “Our examinations of lenders found that blanket policies to withhold transcripts can run afoul of the law.”
The future of withholding transcripts
Berkman-Breen thinks these CFPB findings open the door to the agency examining and condemning the overall practice of transcript withholding. And as more agencies speak out against the harmfulness of these withholding practices, it’s more likely more legislators will take action.
“This isn’t like a foreclosure or an auto repo, because there is no inherent value in the way a house or a car can be resold,” he said. “All it does is keep students in a bind.”
With transcript-withholding legislation growing more popular — Louisiana, Virginia, Maryland, Ohio, New Jersey, Connecticut and Massachusetts have introduced bills — some states are going a step further by adding diploma-withholding to their proposals as well.
However, many students like Shobe remain unaware that these legislative changes are taking place. She said the New School hadn’t informed her that it had ended the practice and feels “like it’s too late to continue my education now.”
When asked about their withholding policies, the New School responded to NBCU Academy: “We used to hold transcripts for financial holds but stopped that practice several months ago. The student should be able to request a transcript without any issues.”
As for me, I have filed the paperwork to get my official transcripts and diploma. It feels like my life may soon, finally, be taken off pause. I’m thinking about applying to graduate school, perhaps even law school. But first, I just want to hang my diploma on the wall, where it has always belonged.