•  
  •  
 

Journal of Student Financial Aid

Journal of Student Financial Aid

Short Title

PAYING BACK STUDENT LOAN DEBT

Abstract

In this study, we examine whether institutional-level characteristics, student demographics, and state conditions are associated with student loan repayment rates and cohort-level loan default rates. We separately explore these characteristics for each of four higher education sectors: public 2-year colleges, for-profit colleges, public 4-year colleges, and private 4-year colleges. We conduct a series of multiple linear regressions on a sample of 2,375 colleges. Estimates suggest that across all sectors except at for-profits, colleges enrolling a higher percentage of historically underrepresented students, including first-generation and African American/Black students, report lower repayment rates. Additionally, a higher percentage of students enrolled who file as independents for tax purposes, as well as lower levels of family incomes among independent students, and lower graduation rates are all associated with lower repayment rates, across all four sectors. With the exception of for-profit colleges, the factors associated with higher cohort default rates include a smaller percentage of Asian students, a larger percentage of first-generation students, and lower median household incomes at the state level. Factors related to one-year and five-year loan repayment rates are similar, indicating that students who struggle to make progress on repaying their loans soon after leaving college continue to struggle in the future.

Download

Share

COinS