Loan Default Rates at Prominent Online Universities – US News and World Report
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After months of scrutiny from legislators, for-profit schools were dealt another blow when the Department of Education released the most recent federal student loan default rates this week. The national average default rate has risen by a tenth of a percentage point to 7 percent from last year . . . [Read more about online education.]
These rates were measured using the pool of borrowers whose first loan payments came due during fiscal year 2008 (Oct. 1, 2007 through Sept. 30, 2008) and who defaulted—or missed at least nine consecutive monthly payments—before Sept. 30, 2009. Borrowers who defaulted after that period aren’t counted in these rates, which are the most recent available. [Learn the 11 Steps to Relief from Federal Student Loans.]
While those who had attended for-profit schools made up just 26 percent of all borrowers, they accounted for 43 percent of the latest defaults. Such a disparity suggests that those who attend for-profit institutions struggle to secure jobs with salaries high enough to cover the costs of their education. [Learn about loan repayment rates for large online universities.]