Many schools at the bottom of the list complained that the government's definition of "repayment" was too tough. Any borrower who went on to graduate school, and thus got the standard school deferment and didn't make any payments, was counted as a non-repayer, for example. So were graduates who took low-income public service jobs and signed up for the new Income-Based Repayment program. If their IBR payments were so low that they don't cover any principal, the graduate was counted as a non-repayer, even though they might have been making monthly payments on time. "You can have students who are following all the rules" for their loans yet be classified as non-payers, making the school look bad, complained Harris Miller, president of the Career College Association.
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Georgia State University Provost Tim Renick was disappointed the government didn't take into account the kinds of students colleges accepted when it reported his school had a 44 percent repayment rate. Half of the freshmen at Georgia State have such low incomes that they qualify for Pell Grants. That typically means their parents don't have any money to help tide them over once they graduate, he notes. He'd prefer the government develop statistics that reveal how much or little a college helps students. "How many more students have firm economic footings after graduation?" he asks.
But others complain that the Department of Education's analysis was too easy on colleges. The analysis didn't examine private student loans, and so may give students an overly optimistic view of how little typical students borrow and how much they are able to repay. In addition, the government's standard for repayment—a single dollar of principal in a year—is "very generous" to colleges, says Sarah Flanagan, vice president for government relations at the National Association of Independent Colleges and Universities, a group of private non-profit universities.
The government says it will consider suggestions for improving the loan repayment data. The Department of Education has already said it will make tweaks to account for borrowers who go on to graduate school or take advantage of public service forgiveness programs. When the number crunchers make those adjustments, some schools showing low repayment rates now may jump up in future lists.
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Mossup of RI 10:57AM September 04, 2010