The portion of students defaulting on their federal student loans inched up 11.3 to 11.5 percent, data released Wednesday by the U.S. Department of Education show.
The rise marks the first increase of the three-year federal student loan cohort in four years, setting off fears that student loan borrowers may be faring worse in the years to come given the department’s efforts to roll back various protections.
“Now is the time to be improving student loan policies and increasing oversight and accountability, but the department is doing the opposite,” said Pauline Abernathy, executive vice president at The Institute for College Access & Success.
“The Department’s rollback of critical protections and enforcement will only lead to more student loan defaults, higher debt burdens, and wasted taxpayer dollars,” Abernathy said.
During the tracking period for the FY 2014 borrower cohort — Oct. 1, 2013 to Sept. 30, 2016 — more than 5 million borrowers entered repayment, and 580,671 of them — or 11.5 percent — defaulted on their loans, the department said in a statement.
“Those borrowers attended 6,173 postsecondary institutions across the nation,” the statement said. “Over the past five years, the rate has decreased 3.2 percentage points from a high of 14.7 percent to 11.5 percent today.”
The fiscal 2014 cohort default rate refers to the percentage of a school’s borrowers who entered repayment on loans through the Federal Family Education Loan (FFEL) program or William D. Ford Federal Direct Loan (Direct Loan) program between Oct. 1, 2013 and Sept. 30, 2014, and who subsequently defaulted prior to Sept. 30 of last year, the statement said.
