"As concerns from the nation’s $1.48 trillion student loan bubble continues to grow, default rates for Arkansas students to attend college declined for the sixth consecutive year and is now just 0.3 percentage points off the national average at 10.4%, according to newly released data from the U.S. Department of Education (USDE)," according to Talk Business & Politics.

"Tony Williams, executive director for the Arkansas Student Loan Authority (ASLA), told Talk Business & Politics that Arkansas student loan cohort default rate has improved from 19% in 2013 to 10.4% in 2019, a decline of 45%. Year-over-year, Arkansas’ student loan default fell from 11.2% in fiscal 2018.

'We are very pleased with the progress that has been accomplished but we won’t be satisfied until Arkansas is ranked in the top half of the nation,' said Williams. 'We began a default management initiative in early 2013 not knowing if we could make a difference. Almost seven years later we have proven that we can make a difference when we set a goal and keep our focus on obtaining the goal.'

The once-a-year cohort default rates (CDRs) for federal student loans were released by the U.S. Department of Education on Sept. 23. In compiling the 2019 data, the USDE measures the percentage of borrowers who entered repayment between Oct. 1, 2015 and Sept. 30, 2016 and defaulted on their loans before Sept. 30, 2018.

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During the current cohort tracking period, 4,533,276 borrowers entered repayment, and 458,687 of them – 10.1% – defaulted on their loans. These borrowers attended 6,130 postsecondary institutions across the country. According to USDE officials, this year’s data shows the national three-year default rate dropped from 10.8% for loans that entered repayment in fiscal year 2015 to 10.1% for loans repaid in fiscal year 2016, a decrease of 6.5%.

National Association of Student Financial Aid Administrators President Justin Draeger said the default rates are trending in the right direction for the second year in a row."

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Publication Date: 10/31/2019