2008 Woodie Awards
Student loan default rates are on the rise
Christina Piazza
Issue date: 2/21/08 Section: News
"I'm skipping graduate school for now and going back home to teach right away, in order to avoid more debt," said senior Travis Babb.
Babb was hoping to get a Masters in teaching from the Isabelle Farrington School of Education at Sacred Heart University, however the cost of living plus classes is simply too much.
"I'm trying to avoid getting into more debt than I already have," said Babb.
Many Sacred Heart students face the same dilemma, how and when will I be able to pay my loans back?
Students try to avoid going into default on their loans. A student loan is deemed in default after it "has persisted for 270 days in the case of a loan repayable in monthly installments or 330 days in the case of a loan repayable in less frequent installments," according to the Department of Education's Web site ed.gov.
A recent study suggests students are becoming more responsible in terms of repayment.
According to the Fairfield County Business Journal, an article published in Oct. 2007 says "Fairfield County colleges and universities cut their student loan default rate to 4.6 percent in the most recent fiscal year, matching the national rate and down from six percent to the year previous."
The number of students paying back their loans on time is increasing, as the local default rate is decreasing. Additionally, the percentage of students in default is lowering to match the nationwide percentage.
"Nationwide, the student loan default rate fell to 4.6 percent in the 2005 fiscal year, down from 5.1 percent in 2004," according to the Fairfield County Business Journal.
This decline can be attributed to lower interest rates and a record high number of students consolidating their loans. Additionally, the better reputation a school has for academics, the more likely it is to see a lower default rate.
According to the Fairfield County Business Journal, schools strongly centered on academics tend to have a higher employment rate after graduation, thus students are have a higher ability to repay their loans.
Babb was hoping to get a Masters in teaching from the Isabelle Farrington School of Education at Sacred Heart University, however the cost of living plus classes is simply too much.
"I'm trying to avoid getting into more debt than I already have," said Babb.
Many Sacred Heart students face the same dilemma, how and when will I be able to pay my loans back?
Students try to avoid going into default on their loans. A student loan is deemed in default after it "has persisted for 270 days in the case of a loan repayable in monthly installments or 330 days in the case of a loan repayable in less frequent installments," according to the Department of Education's Web site ed.gov.
A recent study suggests students are becoming more responsible in terms of repayment.
According to the Fairfield County Business Journal, an article published in Oct. 2007 says "Fairfield County colleges and universities cut their student loan default rate to 4.6 percent in the most recent fiscal year, matching the national rate and down from six percent to the year previous."
The number of students paying back their loans on time is increasing, as the local default rate is decreasing. Additionally, the percentage of students in default is lowering to match the nationwide percentage.
"Nationwide, the student loan default rate fell to 4.6 percent in the 2005 fiscal year, down from 5.1 percent in 2004," according to the Fairfield County Business Journal.
This decline can be attributed to lower interest rates and a record high number of students consolidating their loans. Additionally, the better reputation a school has for academics, the more likely it is to see a lower default rate.
According to the Fairfield County Business Journal, schools strongly centered on academics tend to have a higher employment rate after graduation, thus students are have a higher ability to repay their loans.
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