Student loans at their most basic is simply a wealth redistribution scheme from the middle class to the elite.
When you have third party paying there is no incentive to keep cost under control.
I personally would forbid student loans. If that is not possible I have it so the college themselves must provide the loan and that these loans could be discharged under normal bankruptcy laws.
If the schools were the ones that would lose out if the graduate could not repay the loan they would show a lot more care in who gets a loan.
And they would tailor the curriculum towards the needs of the market, rather than pushing the personal wet dreams of leftist PhDs who have never held a productive job...