Student Loans

States and Colleges with the Most Borrowers in Default

We analyzed the latest Department of Education default rate data to better understand student loan debt, including which types of schools and states tend to see the most students defaulting on their loans.

Key Findings

  • The average federal student loan default rate in the U.S. is 10.8%, down from 11.5%.
  • Approximately 4.9 million borrowers entered repayment and 531,653 borrowers went into default between 2014 and 2017.
  • Overall, public schools had a higher number of student borrowers going into default than private schools with rates of 10.3% and 7.1%, respectively, while for-profit schools had a default rate of 15.6%.
  • Out of all the states, Vermont had the lowest default rate of 5.9% and West Virginia had the highest default rate of 17.7%.

Student loan default is a huge concern, as the overall student debt of $1.5 trillion in the country continues to grow. The Department of Education just released the official cohort student loan default rates for borrowers who went into repayment in fiscal year 2015 in the U.S. and defaulted prior to Sept. 30, 2017. Find out which schools and states have the highest default rate and how to deal with student loan default.

Do Public, Private or For-Profit Schools Have Higher Default Rates?

Default rates for both public and private schools decreased from the fiscal year 2015 cohort data, with 10.3% of public school students and 7.1% of private school students defaulting prior to Sept. 30, 2017. In comparison, borrowers who attended for-profit (proprietary) schools saw an increase in default rates, reaching a default rate of 15.6% from 15.5% last year.

Default Rates by Institution Type

Default Rates by Institution Type

We have included a breakdown of public, private, for-profit and foreign schools that American students attended by the number of years it takes to complete a degree, along with the number of schools, number of defaults, number of borrowers and default rates for comparison. In all institution types, schools that offer degrees that take four or more years to complete had lower default rates.

# of Schools# of Defaults# of BorrowersDefault Rate
Public1,660269,8762,616,32710.3%
Less than 2 years1561,1529,83811.7%
2–3 years807142,775852,42316.7%
4+ years697125,9491,754,0667.1%
Private1,72678,7061,106,5907.1%
Less than 2 years482,24710,19822.0%
2–3 years1475,54133,07016.7%
4+ years1,53170,9181,063,3226.6%
For-profit2,364182,6861,167,28915.6%
Less than 2 years1,26328,288157,85017.9%
2–3 years73943,556238,27718.2%
4+ years362110,842771,16214.3%
Foreign40538510,7263.5%
Total6,155531,6534,900,93210.8%

Do Ethnically Affiliated Schools Have Higher Default Rates?

Native American schools had the highest default rate by far but had only 819 students in repayment and 158 in default. Historically black colleges and universities (HBCUs) followed with 14.9% of borrowers defaulting before September 2017. Keep in mind that the majority of schools are not ethnically affiliated and fall under the category "not reported."

Default Rates by Ethnic Affiliation

Which Flagship State Schools Have the Lowest Default Rates?

The default rates for flagship state schools across the country ranged from 0.9% at the University of Virginia to 12.4% at the University of New Mexico. The average default rate for all state schools was around 4.1%, with more than half the number of state schools below that rate. Below we have included the flagship schools, the number of students that defaulted, the number of students that started repayment, the default rate, the change in percentage points from last year's data and the school's rank based on default rate.

RankSchool# of Defaults# of BorrowersDefault RateY-O-Y Difference
1University of Virginia262,7120.9%-0.4
2University of Michigan - Ann Arbor925,8621.5%0.2
2University of North Carolina - Chapel Hill664,1761.5%-0.3
4University of Wisconsin - Madison995,7001.7%0.2
5University of Vermont462,4681.8%-1.4
6University of Florida1397,1841.9%-0.7
7University of Minnesota - Twin Cities1888,9762.0%-0.1
8University of Maryland - College Park1095,0542.1%-0.3
9University of Illinois at Urbana-Champaign1396,2622.2%0.5
10University of New Hampshire883,8212.3%0.1
10University of South Carolina - Columbia1456,2332.3%-0.8
12University of California - Berkeley1134,7052.4%0.3
12University of Georgia1295,2992.4%-0.6
14University of Connecticut1425,4922.5%0.1
14University of Washington - Seattle2218,8322.5%-0.2
16University of Texas at Austin2098,0352.6%0.2
16University of Iowa1375,1182.6%-0.1
18University of Delaware923,2242.8%0.6
19University of Colorado Boulder1444,5153.1%0.0
19University of Utah1675,3713.1%-0.1
19University of Massachusetts - Amherst1885,9343.1%-0.4
22State University of New York at Buffalo1855,5523.3%0.1
22University of Nebraska1424,2523.3%-0.2
22University of North Dakota1103,3183.3%-0.3
25University of Oregon1534,3383.5%-0.3
26Rutgers, The State University of New Jersey50313,9443.6%0.3
27Indiana University - Bloomington2606,5253.9%0.3
27Louisiana State University1634,1243.9%-1.3
29University of Missouri - Columbia2546,1474.1%-0.4
30University of Hawaii at Manoa1383,2854.2%-1.1
31University of Kentucky2295,0724.5%-0.8
32University of Oklahoma2595,5124.6%0.3
33University of Tennessee80316,9634.7%0.1
34University of Wyoming1052,1194.9%-0.1
35University of Kansas2595,1755.0%0.2
35Ohio State University58511,6705.0%0.1
37University of Nevada - Reno1553,0325.1%0.0
37Pennsylvania State University98319,2275.1%-0.1
39University of Rhode Island1753,3035.2%0.0
39University of Alabama3065,8145.2%-0.5
41University of South Dakota1342,5085.3%0.0
42University of Arkansas2354,2795.4%-1.4
43University of Idaho1442,5265.7%-0.2
44University of Arizona4147,0845.8%-0.9
45University of Maine1682,4756.7%1.2
46University of Mississippi3263,9898.1%-0.7
47West Virginia University6337,4278.5%0.2
48University of Montana3883,77710.2%-0.5
49University of Alaska Fairbanks1641,34112.2%-0.2
50University of New Mexico7716,16912.4%-0.6

Which Top Schools Have the Highest Default Rates?

We looked at the top schools across the country to see which universities and colleges had the highest and lowest default rates for borrowers who went into repayment and defaulted prior to September 2017.

Ivy League School Default Rates

Princeton University had the highest default rate compared to the other seven Ivy League schools, with 3.5% of its student loan borrowers going into default. Dartmouth College had the lowest number of borrowers in default, beating Cornell University and Harvard University, which tied for the lowest percentage of borrowers in default based on last year's data.

Ivy League Default Rates

Top 100 School Default Rates

Out of the top 100 schools, Cooper Union had the highest default rate with 7.5% of its borrowers in default. Otherwise, most of the top schools across the country had default rates ranging from 0% to 3.9%, with three schools having a 0% default rate for borrowers who went into repayment in 2015. We included the top 100 schools, the school's state, the number of students that defaulted, the number of students that started repayment, the default rate, the change in percentage points from last year's data and the school's rank based on default rate compared to the rank from Forbes.

RankForbes RankSchool*State# of Defaults# of BorrowersDefault RateY-O-Y Difference
1#11Williams CollegeMA01980.0%-1.2
1#19Pomona CollegeCA0680.0%0.0
1#84Colorado CollegeCO02300.0%-0.5
4#28Rice UniversityTX14860.2%-0.3
4#59College of the Holy CrossMA14700.2%-1.0
6#3Stanford UniversityCA59590.5%-0.5
6#9Dartmouth CollegeNH35880.5%-0.3
6#54Kenyon CollegeOH11990.5%-1.5
9#8Brown UniversityRI58130.6%-1.1
9#10Duke UniversityNC142,1290.6%-0.1
9#21University of Notre DameIN111,6590.6%-0.3
12#32Vanderbilt UniversityTN121,5100.7%0.2
12#44Wellesley CollegeMA22570.7%-0.1
14#2Yale UniversityCT101,1640.8%-0.6
14#18University of ChicagoIL151,8540.8%-0.5
14#23Harvey Mudd CollegeCA11240.8%0.8
17#34University of VirginiaVA262,7120.9%-0.4
17#42Carnegie Mellon UniversityPA131,3650.9%-0.5
17#49Carleton CollegeMN22090.9%0.4
17#76Santa Clara UniversityCA141,4040.9%0.1
21#4Massachusetts Institute of TechnologyMA76481.0%0.1
21#12Georgetown UniversityD.C.353,2391.0%0.2
21#13Cornell UniversityNY282,7281.0%0.3
21#20Northwestern UniversityIL333,1191.0%0.0
21#35Washington University in St. LouisMO171,6721.0%-0.1
21#39Washington and Lee UniversityVA32781.0%-2.4
21#64Babson CollegeMA54931.0%-0.6
21#87Macalester CollegeMN43811.0%0.2
21#97Brandeis UniversityMA109171.0%-0.2
30#7University of PennsylvaniaPA343,0091.1%0.0
30#25Johns Hopkins UniversityMD342,9251.1%0.1
30#60Hamilton CollegeNY32611.1%0.7
30#77Bryn Mawr CollegePA43491.1%0.1
34#1Harvard UniversityMA262,1461.2%0.5
34#26Claremont McKenna CollegeCA1791.2%1.2
34#50Boston CollegeMA272,2291.2%0.3
34#78Boston UniversityMA695,5411.2%-0.1
34#82Whitman CollegeWA32491.2%1.2
34#88Georgia Institute of TechnologyGA322,4721.2%0.0
34#91Reed CollegeOR32441.2%0.3
34#95Case Western Reserve UniversityOH211,7051.2%-0.4
42#24Swarthmore CollegePA21471.3%-2.5
42#43College of William & MaryVA161,1861.3%0.3
42#86Brigham Young UniversityUT473,5771.3%-0.3
45#36Middlebury CollegeVT85661.4%0.7
45#41Davidson CollegeNC21421.4%0.3
45#102Skidmore CollegeNY53381.4%0.0
48#22University of Michigan - Ann ArborMI925,8621.5%0.2
48#47University of North Carolina - Chapel HillNC664,1761.5%-0.3
48#51Vassar CollegeNY63901.5%1.2
48#62Wake Forest UniversityNC2012771.5%-0.1
48#63Scripps CollegeCA21261.5%1.5
48#66Oberlin CollegeOH63841.5%-1.5
48#101Union CollegeNY63791.5%-0.8
55#15Columbia UniversityNY704,1271.6%0.1
55#33Tufts UniversityMA291,7121.6%0.4
55#37Wesleyan UniversityCT63621.6%-0.5
55#83University of RochesterNY281,6731.6%0.0
59#17Bowdoin CollegeME31711.7%1.7
59#52Emory UniversityGA402,3311.7%0.3
59#58Lafayette CollegePA63511.7%0.6
59#70Villanova UniversityPA321,8101.7%0.4
59#73Bucknell UniversityPA95091.7%0.6
59#75University of Wisconsin - MadisonWI995,7001.7%0.2
59#90George Washington UniversityD.C.794,6321.7%-0.1
59#93University of RichmondVA137371.7%0.4
67#30University of Southern CaliforniaCA1407,7291.8%-0.2
67#46University of California, Los AngelesCA1256,7381.8%-0.3
67#71United States Merchant Marine AcademyNY1531.8%1.8
70#38Haverford CollegePA21011.9%1.9
70#57Barnard CollegeNY63111.9%1.0
70#67Lehigh UniversityPA189471.9%0.3
70#68University of FloridaFL13971841.9%-0.7
70#79Smith CollegeMA126311.9%0.8
70#89Trinity CollegeCT52511.9%-0.9
70#96University of California, IrvineCA974,9291.9%0.1
77#45Colgate UniversityNY52462.0%0.5
77#92Franklin & Marshall CollegePA73442.0%0.6
77#94University of California, DavisCA1155,6202.0%-0.2
80#48New York UniversityNY1898,6352.1%0.1
80#61University of Maryland, College ParkMD1095,0542.1%-0.3
80#81University of California, San DiegoCA1054,9282.1%0.0
83#56University of Illinois at Urbana-ChampaignIL1396,2622.2%0.5
83#98DePauw UniversityIN83632.2%0.5
83#99Yeshiva UniversityNY219532.2%0.1
86#100University of MiamiFL642,7392.3%0.0
87#14University of California, BerkeleyCA1134,7052.4%0.3
87#65Grinnell CollegeIA62502.4%0.6
87#85University of California, Santa BarbaraCA893,6962.4%0.2
87#103University of GeorgiaGA1295,2992.4%-0.6
91#72University of Washington - SeattleWA2218,8322.5%-0.2
91#104Southern Methodist UniversityTX391,5582.5%-0.2
93#74University of Texas at AustinTX2098,0352.6%0.2
93#80Colby CollegeME51872.6%1.1
95#29Bates CollegeME51712.9%1.3
96#6California Institute of TechnologyCA1303.3%3.3
96#16Amherst CollegeMA51513.3%2.1
98#5Princeton UniversityNJ41123.5%0.6
99#69Pitzer CollegeCA51273.9%2.5
100#53Cooper UnionNY5667.5%-0.3

*No data for the United States Military Academy (Forbes Rank #27), United States Naval Academy (Forbes Rank #31), United States Air Force Academy (Forbes Rank #40) and the United States Coast Guard Academy (Forbes Rank #55).

Which States Have the Highest and Lowest Default Rates?

West Virginia had the highest student loan default rate in the country, with 17.7% of its borrowers in default. In contrast, Vermont had the lowest default rate, with only 5.9% of its borrowers in default. To show the differences in each state, we've included a gradient map outlining the states with the lowest and highest default rates, with a darker color representing high default rates.

States with the Highest Student Loan Default Rates

National Ranking of States By Default Rate

Here is a national ranking of all the states by overall default rate and the difference in percentage points from last year's data, which also includes the default rates for public, private and for-profit schools in each state. Although public schools have higher average default rates than private schools, in some states, the reverse is true.

RankStatePublicPrivateFor-profitOverall Default RateY-O-Y Difference
43Alabama10.9%12.1%17.9%12.9%-0.2
41Alaska12.3%13.0%16.7%12.5%-0.3
45Arizona12.4%5.2%12.4%13.1%-1.0
31Arkansas10.2%10.1%15.5%11.2%-1.0
21California6.8%4.0%12.7%10.2%-0.3
33Colorado9.4%8.5%16.4%11.6%0.3
25Connecticut5.6%5.2%16.1%10.5%1.3
15Delaware8.0%9.9%16.1%9.5%0.1
9District of Columbia15.1%3.6%11.3%8.5%-1.5
35Florida9.3%14.2%13.9%11.7%-2.8
32Georgia10.9%7.8%15.4%11.3%-0.9
12Hawaii10.3%5.6%14.4%9.4%-1.4
11Idaho10.6%10.6%10.6%9.3%-1.5
21Illinois10.5%4.5%13.1%10.2%0.2
47Indiana11.9%7.5%14.0%14.2%-0.2
33Iowa12.9%5.4%7.8%11.6%-1.0
36Kansas9.3%7.8%22.1%12.0%-0.4
48Kentucky15.6%8.2%13.2%14.3%0.3
29Louisiana11.1%6.4%13.9%11.1%-1.6
25Maine12.1%4.7%13.3%10.5%-0.5
17Maryland8.9%3.5%19.4%9.7%-0.4
2Massachusetts8.0%3.7%12.6%6.1%-0.4
38Michigan11.6%12.3%20.6%12.2%-0.7
7Minnesota9.4%3.3%7.1%8.1%-0.8
46Mississippi14.8%9.4%16.7%14.1%-1.0
23Missouri10.8%6.9%19.0%10.3%-0.6
12Montana9.8%3.4%13.6%9.4%-0.9
6Nebraska8.9%4.8%13.2%7.9%-0.6
49Nevada13.7%20.3%19.3%15.3%1.9
19New Hampshire7.7%11.0%9.0%9.8%1.4
17New Jersey7.5%5.8%13.1%9.7%-0.1
50New Mexico16.6%7.2%16.9%16.2%-2.0
9New York9.3%4.3%13.9%8.5%-0.1
27North Carolina11.3%9.4%10.5%10.8%-1.9
3North Dakota5.7%7.9%13.1%6.2%-0.2
38Ohio13.2%7.3%15.3%12.2%-1.4
37Oklahoma12.4%9.2%18.5%12.1%0.5
42Oregon14.1%4.1%11.6%12.8%-1.4
16Pennsylvania9.7%5.2%17.4%9.6%-0.3
4Rhode Island8.8%4.4%10.8%6.5%-0.8
5South Carolina7.2%6.5%8.9%7.0%-3.7
43South Dakota7.5%5.3%23.3%12.9%-0.7
29Tennessee8.8%7.0%18.2%11.1%-0.7
28Texas9.6%8.6%18.4%10.9%0.5
8Utah7.7%3.6%16.5%8.3%-0.9
1Vermont7.1%3.8%17.9%5.9%-1.0
12Virginia8.2%9.8%13.4%9.4%-0.6
24Washington9.7%5.6%13.3%10.4%0.0
51West Virginia13.2%8.6%22.9%17.7%-0.6
19Wisconsin10.5%7.1%12.8%9.8%-0.5
40Wyoming9.3%23.1%8.3%12.3%-3.0

What to Do if Your Federal Student Loans are in Default?

When your federal student loans enter default, you are faced with three main ways to get your loans back in good standing, along with a variety of consequences. To get out of default, you'll either have to rehabilitate, consolidate or repay your loan in full, and it is best to act quickly to avoid accruing more debt. Some of the consequences you may face include: losing eligibility for loan repayment assistance programs, wage garnishment (in which your employer withholds a portion of your salary), legal action and a decreased credit score.

Rehabilitation

In order to rehabilitate your federal loans, you must agree in writing to make nine voluntary monthly payments within 20 days of the due date during a period of 10 consecutive months. Generally, your loan holder will determine a monthly payment amount equal to 15% of your annual adjusted gross income. If you can't afford the monthly payments, you can ask your loan holder to calculate an alternative monthly payment that includes some of your expenses.

After you have made the required nine payments, your loan will be taken out of default status, the derogatory mark will be removed from your credit reports, and you'll regain eligibility for the benefits that were available to you before you defaulted. You can only rehabilitate your federal student loan once.

Consolidation

You can also get out of default by consolidating several federal student loans into one Direct Consolidation Loan. In order to do this, you must agree to repay the Direct Consolidation Loan through an income-driven repayment plan or make three consecutive on-time full monthly payments before consolidating.

After the defaulted loans have been consolidated, you'll regain eligibility for federal benefits like deferment and forbearance. Unlike loan rehabilitation, the record of your default is not removed from your credit reports after consolidation.

Repaying Your Loan in Full

Your last option is to repay your defaulted loan in full, which is not possible for most student loan borrowers, especially if they are in default. But if you happen to find the funds to pay off your loan and want to eliminate your debt, you can contact your loan holder or pay off your debt online, depending on your servicer's policy.

Methodology

Default rate data was gathered from the Federal Student Aid division in the U.S. Department of Education. The figures were calculated using the 2015 cohort default rates by state, institution type and school. The state schools were taken from the College Board's list of flagship universities, and the top 100 universities and colleges were taken from the Forbes 2018 list of America's Best Colleges.

Sources:

Madison Miller

Madison is a former Research Analyst at ValuePenguin and focuses on student loans and personal loans. She graduated from the University of Rochester with a B.A. in Financial Economics with a double minor in Business and Psychology.