Forty-five percent of defaulters have not found a solution to return their most recent default back to good standing. Sadly, once borrowers defaulted, many had trouble getting out.
The median borrower took 2.75 years to default after entering repayment. Instead, data show that defaulters take advantage of opportunities to pause payments without going delinquent. 3 Three out of every 10 defaulters are African American and nearly one-half of all defaulters never finish college.īy and large, defaulters do not follow a straight line from entering repayment to defaulting at the earliest possible moment, after 270 days of delinquency. The median defaulter takes out slightly over $9,600-just more than one-half of what the median nondefaulter borrows. Defaulters are more likely to be older, be Pell Grant recipients, and come from underrepresented backgrounds than those who never default. The data show that the average defaulter looks very different from stereotypical portrait of a college student as someone who comes straight to college out of high school and lives in a dormitory on campus while pursuing a bachelor’s degree. 1 New data present the best picture ever accessible of who these borrowers are, the path they took into default, and whether or not they were able to return their accounts to good standing.
Every year, 1 million student borrowers default on nearly $20 billion in federal loans.
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