Income-driven repayment (IDR) plans are a subset of student loan repayment plans that cap a borrower's monthly payment at a percentage of their discretionary income, which is defined as a portion of a borrower's adjusted gross income (AGI) that exceeds a specified multiple of the federal poverty line (FPL) for the borrower's family size. A…

Today, approximately 43 million Americans hold a federal student loan. When these borrowers fall behind on payments, they become delinquent on their loans; once the loans reach 270 days past due, borrowers are in default. As of March 2021, roughly 1 in 5 borrowers was in default, according to data from the U.S. Department of Education. Failing to…

This study analyzed the debt profile of low-income households before and after the Great Recession using the 2007, 2010, and 2013 Survey of Consumer Finances (SCF). We used Heckman selection models to investigate three debt characteristics: (a) the amount of debt, (b) debt-to-income ratio, and (c) debt delinquency. Before and after the Great…

This brief uses administrative data provided on the Baccalaureate and Beyond and Beginning Postsecondary Students data sets to examine student loan repayment over time. Specifically, we provide descriptive details on what differentiates borrowers in income-driven repayment (IDR) plans and explore the relationship between these plans and short-term…

As of May 2013, total outstanding student loan debt in the United States had reached $1.2 trillion, up from $1 trillion fewer than 18 months before. The growth in debt is due primarily to increases in both the rate of borrowing and the average amount borrowed, especially among graduates of 4-year institutions. In 1989-90, about half (51 percent)…

This study investigated whether spending habits before and during the Great Recession predicted financial distress. Financial distress was defined as failing to make mortgage and non-mortgage loan payments on time. Data from the 2007-2009 panel of the Survey of Consumer Finances revealed that one's prerecession spending habit did not seem to…

Background/Context: Sub-baccalaureate certificates can provide an accelerated pathway to gainful employment for the unemployed or underemployed. Certificates represented only 6% of postsecondary awards in 1980, but today they represent 22% of all credentials awarded and have superseded associate's and master's degrees as the second most common…

Private for-profit institutions have been the fastest growing part of the U.S. higher education sector. For-profit enrollment increased from 0.2 percent to 9.1 percent of total enrollment in degree-granting schools from 1970 to 2009, and for-profit institutions account for the majority of enrollments in non-degree granting postsecondary schools.…

Attempted to replicate and extend the findings of earlier Student Loan Recipient Survey of the 1987 National Postsecondary Student Aid Study (NPSAS:87) on student loan defaults. Analysis of 1,117 borrowers from 510 institutions indicated that besides certain precollege traits and high grade point averages, postcollege employment congruent with the…

Based on a survey of former California State University students who repaid (224) or defaulted on (128) loans, an analysis found high levels of significance in postsecondary outcome variables (graduation, employment and income patterns), institutional practices and characteristics, student background characteristics, and understanding of rights…

Analysis of National Postsecondary Student Aid Study data for 11,000 students in loan programs at 1,400 institutions found borrowers with similar earned degrees, marital status, number of dependent children, showed similar levels of income/loan default, regardless of racial/ethnic group. Findings dispute national policy and suggest that campuses…

This congressional report argues that the costs of the current guaranteed lending program for postsecondary education can be reduced in three ways: (1) by eliminating more-than-competitive returns to private lenders; (2) by reducing administrative costs; and (3) by reducing default costs. It is suggested that the first solution can be accomplished…

In an effort to better understand student loan default behavior at Texas A&M University (TAMU), the research staff at TG, at the request of TAMU, conducted a study of the relationship between loan default, on the one hand, and many student and borrower characteristics, on the other hand. The study examines the default behavior of 12,776…

A study of the debt levels of graduate and professional students is reported in narrative, data tables, and graphs. Highlights include: total annual borrowing through federal loan programs has accelerated dramatically, with more than a million graduate and professional students now borrowing nearly $8 billion per year; graduate and professional…