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Billionaire Robert Smith is erasing student loan debt from Morehouse grads – and their parents

Billionaire to pay off Morehouse grads' student debt
Morehouse College commencement speaker will pay off student debt for Class of 2019 01:04

Billionaire Robert Smith is extending his goodwill months after he pledged to erase college loan debt for Morehouse College's 2019 graduating class. The technology investor and philanthropist is also paying off loan debt amassed by parents to send their children to the college, the school said on Friday.

Morehouse College announced in a release that Smith and his family donated $34 million to a fund that wipes away student debt for parents whose children attend the university. 

"This liberation gift from Robert Smith — the first of its kind to be announced at a graduation in higher education — will be life-changing for our new Morehouse Men and their families," said Morehouse College president David A. Thomas.

Thomas hopes the graduates use their "newfound financial freedom" to pursue their career goals and pay it forward for future graduates.  

Known as the Morehouse Student Success Program, the initiative was established as a national investment strategy to curb student loan debt and help graduates prosper faster, according to the release. Under the new plan, Morehouse will solicit and accept donations made specifically to reduce or eliminate the loan debt of students and their parents or guardians.

More than 400 students, parents and guardians of the Class of 2019 will receive the inaugural gift under the initiative. The fund will cover education loan balances as of August 28. According to the release, six types of loans will be repaid: federal subsidized loans, federal unsubsidized loans, Georgia Student Access Loans, Perkins Loans, Parent Plus Loans and certain private student loans processed through Morehouse College.

Back in May, Thomas said he had "no idea" the announcement was coming. "People were stunned. If you look at any other film footage, you will see the students turning to each other. 'What did he say? Did he say what I think he said,'" Thomas told CBS News correspondent Mark Strassmann. "This will allow them to pursue their dreams... As opposed to serving the debt."

Morehouse College is an all-male historically black college located in Atlanta. Smith is the founder, chairman and CEO of Vista Equity Partners, a private equity firm that invests in software, data and technology-driven companies.

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