[ejnulls]

>Do lenders imagine they're more likely to recover their money this way?

Who knows. But if grad students would act like even half-way decent business men and women then they would pass their costs on to their customer (i.e. their boss).

Just because costs go up doesn't mean your rate of return needs to fall.

[isostatic]

Assuming a competitive market you can't pass costs on, you charge what your customer is willing to pay, whether your costs are zero or high. If costs are higher than what customers will pay, you don't have a business.