In the most recent data available, 34 percent of students who began their education at a for-profit school in the 2011–2012 academic year, and entered repayment of their federal loans by 2017, defaulted on their loans. Primarily due to higher average debt levels as well as lower earning and employment outcomes, the default rate is highest for borrowers who attended for-profit colleges compared to nonprofit and public schools. Students at for-profit schools and Black borrowers have the highest federal student loan default rates.For instance, those who attended private, for-profit colleges owed about $14,000, or around 50 percent, more than borrowers who attended public or private, nonprofit schools. Factors such as enrollment rates in graduate school programs, type of college attended, and economic outcomes after graduating can affect those debt levels. Black borrowers owe over $13,000, or nearly 50 percent, more than white borrowers. On average, women owe nearly $3,000, or 10 percent, more student debt than men. Women, Black borrowers, and students at for-profit schools owe more federal student debt, on average, than other groups of borrowers.That distribution marks a substantial difference from a few decades ago when student loans were provided by private lenders, but subsidized and backed by the federal government. Most student debt is owed to the federal government.Ībout 92 percent of all outstanding student debt is owed to the federal government, with private financial institutions lending the remaining 8 percent.Overall, borrowing for graduate education accounts for 56 percent of student debt currently outstanding.

By comparison, the average annual loan for undergraduate students grew from $3,290 to $5,460 over the same time period. Between the 1995––16 academic years, the average annual loan for graduate students grew from $10,130 to $18,210, according to the Urban Institute. The average borrowing levels for graduate students has grown significantly over the past couple of decades. Graduate school borrowing accounts for most of the student debt outstanding.Among households that took out student loans, the average amount of such debt owed increased nearly four-fold from 1989 to 2019 - even after adjusting for inflation. The average amount of such debt owed per household has increased substantially over the past several years, which has also contributed to the growth in the total amount of student debt outstanding. Adults face a much higher burden of student debt than in the past.That trend is true for younger households as well the prevalence of student debt for those households has climbed from 15 percent in 1989 to 41 percent in 2019. The percentage of households with student debt has almost tripled, from 8 percent in 1989 to 21 percent in 2019. One major reason for the significant rise in student debt is that more Americans are borrowing to attend college. More adults are burdened with student debt today.Student debt is also the second-largest source of household debt, trailing only mortgage debt. Since 2004, student loan debt has risen faster than other household debt and has surpassed both auto loan and credit card debt in 2010. Student loan debt has been growing faster than other sources of household debt.That growth in debt significantly exceeds the increase in the number of students, which the Department of Education estimates has only risen by 2 percent among undergraduates and by 12 percent at the graduate level. The amount of student debt in 2020 totaled nearly $1.6 trillion, more than twice the amount outstanding in 2008 ($600 billion). Student debt has more than doubled since 2008.Those effects are being felt by Americans across the country as young college graduates today are entering the workforce with unprecedented amounts of student debt, and older Americans are still paying off such debt years after graduation.īelow, we explore some key facts on the growth and distribution of student debt in the United States, mostly based on data from the Federal Reserve and the U.S. While investing in a college education has undeniable, lifelong economic benefits, excessive levels of student debt can impose hefty financial burdens on borrowers - such as restricting how much they can save for retirement, affecting their ability to buy a home, and even delaying life decisions such as starting a family.

Who pays for student loan defaults