Trends in Student (Loan) Persistence

January 24, 2020

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Title: When Student Loans Linger: Characteristics of Borrowers Who Hold Student Loans Over Multiple Decades

Authors: Kristin Blagg

Source: Urban Institute

The Urban Institute has published a new report on the lingering student loan debt held by borrowers.

Using credit report data, the report examines a two-percent sample of borrowers and identifies borrower characteristics based on the oldest student loan held. The report also examines trends in median amounts owed, repayment progress, defaults and deferment, bankruptcy filings, and borrowers’ neighborhood demographics.

Among the findings:

  • Less than half (48.6 percent) of all student loan debt owed in 2018 had originally been dispersed in 2007 or later.
  • Borrowers who took out their first student loan before 1990 had the smallest median amounts owed ($11,944). Of these borrowers, 19 percent had deferred at least some of that debt, and 16 percent had debt in collections.
  • Those took out their first loan between 2000 and 2004 made the most progress in paying off their student loan debt, with balances that were 81 percent of the original loan amount.
  • Those who took out their first loan between the mid 1990s and early 2000s lived in zip codes with higher median incomes and credit scores, and a higher share of their neighbors had earned at least a bachelor’s degree.

The author notes that trends in borrower characteristics and outcomes for those who first borrowed between 2010 and 2014 may be impacted by currently enrolled students who have loans in deferment. The report concludes with a discussion of trends for different types of loans and offers recommendations for policymakers to help students address and avoid lingering loan debt.

For the full report, please visit the Urban Institute’s website.

—Charles Sanchez

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