Students taking on federal student loans to attend Connecticut schools do about the same or better at repaying that debt than students at schools across the country, but the type of school makes a difference.
Nationwide, schools had an average default rate — the percentage of borrowers in the repayment phase who are in default — of about about 10.7 percent in fiscal year 2013. That’s according to data from the Office of the U.S. Department of Education Federal Student Aid. The fiscal year is from October through September. The 2013 year is the most recent for which data were available.
The department describes default as “failure to repay a loan according to the terms agreed to in the promissory note.” For most federal student loans, that often means having not made a payment for more than 270 days.
Characteristics of the school can change the story.
Nationwide, schools offering at least a four-year program had a similar default rate of 10.1 percent, but in Connecticut, schools with four-year programs had a lower, better default rate of 7.7 percent.
Schools where the longest program offered was less than four years had similar rates in Connecticut (13.5 percent) and nationwide (13.3).
The non-profit, and public or private status of school makes a difference, too.
In Connecticut, public schools, such as the CSCU schools, had a default rate of 9.4 percent (compared with 13.4 percent nationwide) while private non-profits, such as Yale, had a much lower 4.1 percent rate (6.3 nationwide).
For-profit schools had a 13.3 percent default rate in Connecticut and 12.8 percent nationwide.
The following table shows official default rates from all Connecticut schools for which data was available from the Student Aid office. Note that in cases where the total number of borrowers in the repayment phase is very small, each borrower that goes into default can swing the default rate higher than a single student at a school with more borrowers.