With all the scary headlines about new graduates floundering under too much student debt, wouldn't it be great if students shopping for colleges could find out ahead of time which schools offered them the best chance of paying down those loans?
Now you can. And you'll be surprised at which colleges have unusually high—or unusually low—student loan repayment rates.
The U.S. Department of Education has released a controversial chart showing its estimate of the 2009 federal student loan repayment rate for just about every college, job training, and graduate school in the country: 8,412 institutions in all. The government looked at all the federal student debts of all students who graduated or left college between October 2004 and March 2008. Any of those who paid as little as $1 in principal from October 2008 through September 2009 was counted as repaying. While many students and parents would prefer to learn how quickly graduates of each school fully pay off all their student debts, not just federal loans, those data aren't available yet. College aid officials say the new repayment rate chart is at least a step in that direction.
Atop the new list of schools with the highest loan repayment rates are some tech, nursing, liberal arts and religiously affiliated colleges. More than 90 percent of recent CalTech grads were paying down their loans in 2009. But so were more than 90 percent of graduates of Dordt College in Iowa, a Christian liberal arts college with a total sticker price of more than $33,000. Other high repayment rate schools include several secular liberal arts colleges with sticker prices of more than $50,000–such as Colby, Gettysburg, Lafayette, and Williams. Those schools, however, are also very generous with financial aid.
[Read about some Congress members' attempts to offer relief to those struggling with student loans.]
Mixed in among beauty schools and other for-profit trade schools at the bottom of the repayment list are some well-known historically black colleges, such as Grambling State, Fisk, and Tougaloo. The low repayment group included many religiously oriented colleges, too. The government reported that only 32 percent of the federal debts incurred by students at the University of Mobile, a private Christian college, were being repaid in 2009, for example. That university questions the government's calculation, noting that other government reports show it has a very low loan default rate. Liberty University's repayment rate was reported at 45 percent. Liberty also says other reports show its students rarely default on their loans, and the school is launching a new default management system this year. Some urban public universities, such as Wayne State and Georgia State, also had rates below 45 percent.