The overall amount of student debt outstanding has doubled since 2007 to around $1.3 trillion. The federal government’s direct lending represents more than 85% of origination volume.
Approximately 76% of federal student loans are originated with zero credit underwriting
The overall default rate (270 days without repayment) on outstanding federal student loan balances is 9.1%. Loans in deferment and forbearance represent an additional 22.7% of total outstanding loan balances.
Loan default rates by type of school:
- Private non-profit: 5.2%
- Public 9.6%
- Private for profit: 13.6%
As of June 2014, $543 billion in loans are in repayment, while $545 billion in loans are not being repayed for various reasons. (In school, grace period, deferment, default, etc.)
Much of this borrowing benefits for-profit schools. Students at for-profit universities are twice as likely to utilize federal student loans. Approximately 68% of the students at these schools either drop out or do not finish their degree programs within 6 years.
A larger percentage of students are taking out federal student loans (48% in 2012 versus 33% in 2002)
An average of 40% of students at four-year institutions (and 68% of students in for-profit institutions) do not graduate within six years, which means they most likely do not benefit from the income upside from a higher degree yet have the burden of student debt.
Student loan info starts on Pg. 52.