New data from the U.S. Department of Education show that 10.8 percent of federal student loan borrowers who entered repayment in 2015 had defaulted on their loans by 2017, a decrease from the prior year’s rate of 11.5 percent. Rates decreased at public and nonprofit colleges, but increased at for-profit colleges. Default rates play a critical role in holding colleges accountable and tracking how many borrowers experience the worst student loan outcomes soon after leaving college. The consequences of default are costly, long-lasting, and too often punitive. Student loans are intended to help to lift students up, but defaulted loans push them back down.
September 26, 2018