STUDENT LOAN DEFAULT RATE CONTINUES TO DECLINE
SEPTEMBER 27, 2019
Data released by Department of Education on September 25 showed that the share of borrowers defaulting on their student loans has declined for the sixth straight year. Of borrowers who entered repayment in 2016, 10.1 percent had defaulted on their loans by 2018, This percentage is down from 10.8 percent from the previous year. For-Profit colleges had the highest rate of defaults at 15.2 percent compared to 9.6 percent at public institutions and 6.6 percent at private institutions. Borrowers enter default when they go more than 270 days without making a payment on their federal student loans. That outcome leads to damaged credit scores and can mean wages or government benefits are garnished. Borrowers in default are also barred from accessing additional federal student aid until their loans are repaired. I am pleased to report that colleges and universities affiliated with the Association for Biblical Higher Education and the Council for Christian Colleges and Universities traditionally have default rates that are even lower than the 6.6 percent at other private institutions.
Larry J. McKinney
Higher Education Consultant