Student Loan Default Rate Highest in 14 Years
Wednesday, September 14, 2011
College graduates are struggling the most since the 1990s to keep up with their student loan payments, according to new data from the U.S. Department of Education.
Among student borrowers, 8.8% defaulted last year on their loans, up from 7% the previous year. The 2009-2010 rate marked the highest it’s been since 1997, when it was also 8.8%.
The situation was especially bad for former students of for-profit colleges, where the default rate was 15% for those in the first two years of repayment, up from 11.6% in the prior year. Although for-profit colleges enroll only 10% of the nation’s undergraduates, they account for almost half of the defaults. Because the government statistics only cover the first two years of repayment, the problem may actually be much worse because most student loan defaults occur after two years.
At public universities, the rate was 7.2%, up from 6%.
-Noel Brinkerhoff, David Wallechinsky
Student Loan Default Rates Rise Sharply in Past Year (by Tamar Lewin, New York Times)
Default Rates Rise for Federal Student Loans (Department of Education press release)
Meet the Filmmakers Who Are Fighting the Student Loan System (by J. Maureen Henderson, Forbes)
Student Loan Debt Passes Credit Card Debt for First Time (by Noel Brinkerhoff, AllGov)
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