Student debt is spiraling, and young people are defaulting on their loans. You might think that students would be better off scraping by with no loans at all.

But it turns out that simply cutting loans — without replacing those lost dollars with grants or lower tuition — hinders students’ academic progress and hurts their grades.

That’s the conclusion of new research on the effects of student loans at community colleges, which educate most low-income students in the United States. What’s more, community colleges are far more racially, ethnically and economically diverse than the elite colleges that get the most attention.

Perhaps counterintuitively, the researchers found that students who borrowed more wound up defaulting less. This was most likely because the loans allowed students to earn additional college credits, which led to more stable careers and finances.