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Student loan default rate drops significantly
October 06, 2022
Hopefully, it's not the calm before the storm.
No borrowers have defaulted on their student loans, as expected, since the pause on federal student loan payments in March 2020.
The Department of Education released the National Default Rate Briefing for FY 2019 earlier this month.
According to the Briefing, the FY 2019 national cohort default rate is 2.3%, which is a 68.5% drop from the FY 2018 rate of 7.3%.
According to the Department, FY 2019 cohort default rates were significantly impacted by the pause on federal student loan payments that began March 13, 2020. During the pause, borrowers with ED-held student loans were not required to make any payments, and no borrowers with ED-held loans entered default.
Financial aid professionals with questions about the briefing should contact the Department by emailing fsa.schools.default.management@ed.gov or by calling the Cohort Default Rates Group at 202-377-4259.