Study Shows Students Are Borrowing More for School

The graduates are also paying the loans back at a slower pace

When the federal government returned to work Thursday, after the shutdown, the U.S. Education Department’s National Center for Education Statistics released a report from data gathered by a Baccalaureate and Beyond Longitudinal Study. The report analyzed the repayment and borrowing trends for three cohorts of students. The focus of the study was on bachelor’s degree recipients and their tendency to repay their student loans within a year of graduation.

Compared with students who completed an undergraduate program in 1992-1993 and 1999-2000, 2007-2008 students were less likely to repay the loans within a year of graduation and were more likely to borrow money to pay for college in the first place. In each successive cohort, the percentage of college graduates who borrowed for undergraduate education rose; from 49 percent in 1993 to 64 percent in 2000 to 66 percent in 2008, according to the report.

Each successive cohort also showed an increase in average cumulative debt. Compared with 66 and 65 percent in the previous cohorts, loans repaid within one year dipped to 60 percent in 2009. Additionally, the percentage of graduates in default, forbearances or deferment also rose over the respective periods.

The report also revealed that 25 percent of students who graduated with a bachelor’s degree in 2008 enrolled in graduate school one year later. This was an increase over all other cohorts. However, there was no correlation in the study to the amount of debt already incurred across all three cohorts to graduate school attendants. The data was not correlated to students that moved back in with their parents after graduating.

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