IN CREATING ITS new parent Loan Program--which allows middle-income parents to pay for undergraduate fees through a six-to eight-year installment plan--the University has recognized that increasing tuition costs are gradually forcing middle-income students to turn away from Harvard and other private college.

Students whose family income falls in the $15,000 to $50,000 range covered by the program are not usually eligible for financial aid from either Harvard or the federal government, but their parents are still hard-pressed to shell out nearly $7000 each year in college bills. Because of its prohibitive cost, many students in that income range never apply to Harvard and some who do apply and are admitted, end up attending state universities because of the more manageable tuition.

Until the University--or the federal government--makes available more funds for financial aid, or finds some way to freeze or reduce tuition, the parent loan program should serve to expand Harvard's applicant pool and perhaps increase diversity among students.

If the program proves successful next year, the University should consider expanding it to include students from he graduate and professional schools. And it should continue its efforts to combine with other private colleges in a similar program. The squeeze put on middle-income families by college tuition is a national problem, and a program involving many institutions would be one way of alleviating it.

However, the University's definition of "middle-income" is very broad--$15,000 is not in the middle of anyone's income distribution graphs--and unless there is a substantial response from families on the $15,000 to $25,000 end of the scale, the program should not be considered a success.

In addition to its obvious importance for middle-income students and parents, the loan program also serves as a much needed gesture of good faith from the University. The new loan program is a small step in the right direction.