National Default Rate for Student Loans Rises, Breaking Streak of Declines

For the first time since 2013, the overall three-year cohort default rate on federal student loans has risen, if ever so slightly, the U.S. Department of Education announced on Wednesday.

The percentage of borrowers defaulting on their student loans within the first three years of entering repayment ticked up fractionally, from 11.3 percent to 11.5 percent, for those who began repayment in 2013-14. However, that number is still lower than it was for students who entered repayment in the 2012 fiscal year. The default rate for public institutions remained steady, at 11.3 percent, and rose for private colleges, from 7.0 percent to 7.4 percent.

Based on the data released on Wednesday, 10 institutions with high cohort default rates are at risk of losing their access to federal student aid. When a college’s cohort default rate exceeds 30 percent for three consecutive years or 40 percent in a single year, it becomes ineligible to receive federal student aid.

Southeast Kentucky Community and Technical College is among the at-risk institutions but may have some respite:

Worth noting: McConnell added rider to FY18 budget to protect SE KY Comm & Tech College (slated to lose Title IV). https://t.co/oMjm3vxRnV pic.twitter.com/Hiwsthgf85

— Robert Kelchen (@rkelchen) September 27, 2017