The number of students who default on their federal loans is on the rise, according to a report released this week by the U.S. Department of Education.
The report, which compiled information from the 2009 fiscal year, said student default rates are the highest they have been since 1997.
The study noted an trend of increased default rates across all types of schools. At public institutions, default rates jumped from 6 percent to 7.2 percent. Private institutions saw a similar spike from 4 percent to 4.6 percent. For-profit schools experienced a bump from 11.6 percent to 15 percent in the previous fiscal year, the report stated. Specifically, 320,000 of the 3.6 million borrowers whose first loan payments were between Oct. 1, 2008, and Sept. 30, 2009 defaulted before September 30, 2010.
In 2009, the default rate for federal loans at the University was 1.6 percent, barely up from 1.5 percent in 2008.
"Even though the default rates nationwide did increase, they didn't really increase here [at the University]," said Scott Miller, senior associate director of Student Financial Services. "Our number stayed relatively flat. It only went up a tenth of a point, and that difference in a tenth of a point was only a four-student difference."
The University's default rate of 1.6 percent is significantly lower than the 7.2 percent average of public institutions nationally.
Colleges and universities with more instances of default could face consequences from the federal government.
"Schools with excessive default rates may lose eligibility in one or more federal student aid programs," the Department of Education said in a statement.
This year, five schools will lose their eligibility for one or more of the federal aid programs.
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