Schools Ranked by Default RatePage 5

Default rates measure the percentage of students who fail to repay their federal student loans. A lower default rate indicates that students are finding an adequate means of income after leaving the school because they can afford to pay back their student loans. In addition, lower loan default rates also indicate a lower amount of student debt. For each school, we looked at the most recent cohort default rates published by Peterson’s for the 2013 fiscal year.

Peterson’s did not have the default rate for all of the colleges on our list. We did not, however, want to penalize those colleges without data. To that end, we simply excluded those schools from the rankings in this category.

The Importance of Default Rates

Potential students might tour the campus of a prospective college, inquire about class sizes, or even try out the food in the cafeteria before making their final choice on where to go to school. But there’s another aspect of the big decision that is important to not overlook: the college’s default rate.

Let’s start at the very beginning. When a student borrows money to help pay for college, but then doesn’t pay the loan back as scheduled, that is called a default. Therefore, student loan default rates for colleges are the rates at which their graduating students are not paying back their loans.

While at first glance loan default rates may point to the student’s inability to pay back the loan, it can also be very telling about the college itself. If a school has a low default rate, they have potentially taken on the issue as a point of focus, helping students avoid debt and/or better preparing their students to be a competitive work candidate after graduation. Schools can assist students by offering additional forms of financial aid like scholarships, grants, and on-campus or work-study jobs, and try to keep student loan rates low. Then, after graduation, they continue to work with the students to ensure they are being responsible borrowers.

This is important, as student loan rates and debt are higher than ever before. College is expensive, and can be difficult to pay off if the borrower is unprepared. In effect, a student takes out a loan with hopes that the college they choose will be a wise investment. This means that the college will adequately prepare them with the tools they need to obtain quality employment post-graduation.

But research has show that this investment doesn’t always pay off. More than 40% of students who finish college with debt will have delinquent or defaulted loans within five years. This makes it even more critical for colleges to provide support for students.

Because student loan debt is such a trend, colleges that can maintain minimum default rates have the opportunity to be recognized against other higher-debt rate alternatives. Prospective students will take note, as will accreditors and college-ranking organizations. Many factors can play into an individual’s inability to pay back the loan as scheduled, like their financial means, the state of the economy when they graduate, and the loan’s terms, but colleges can still do their part to mitigate the problem and provide essential outlets and services to assist students.

For instance, colleges with lower default rates have likely taken steps to prepare a strategy and process around keeping them that way. First, they have made the issue a whole-campus initiative. This means that professors and the administration are under the assumption that debt is not just a financial aid issue. These colleges also might have a person onsite to further help with default prevention and promote financial literacy. This person is usually part of a larger debt management team, which brings together departments and staff from all over the college to act as a triage to default. Financial aid packages are typically more robust at these institutions, too, and their offices are well-equipped to walk students through the debt process and explain the consequences of borrowing too much.

Defaulting vs. Delinquency vs. Deferment

The world of student loans can be a tricky one, full of jargon and different levels of payment stages. During loan repayment, especially if you are finding it hard to keep on schedule, you will likely hear three words: delinquent, default, and deferment.

Any student who misses a payment, from the first day on, is considered delinquent. This is when the negative effects on non-payment start to set in. Students will start getting notifications from their loan provider, and delinquency that continues for a long period of time could result in lost of interest rate discounts on the loan and jeopardize your credit score. Delinquency is any period up until the loan is considered in default.

Based on how long your loan has been delinquent, there are a variety of steps to rectify the problem. If you have only missed one or two payments, call your loan servicer immediately. If it has been under 60 days, your status may not have already been sent to credit companies. You have probably incurred some fees and late payment charges, so you’ll need to pay those while getting your account caught up.

If you’ve missed more than two payments, taking action is imperative. This is the time when your information has been sent to credit companies, and your delinquency will start to become part of your credit score. Work with your loan servicer on a payment plan that might better meet your financial means, and try to get the loan down to under 90 days past due.

Once you hit the six-month mark, you start running out of options and safety nets. Collections and wage garnishments become a real possibility, so it’s critical you contact your loan servicer ASAP.

If you don’t, your loan will likely move to default status. A student loan in default occurs when no payments are made on the loan for 270 days (or about nine months). Defaulting on a loan comes with harsh consequences. Instead of the original payment schedule, the full balance of the loan becomes due. You also lose the eligibility to request deferment or forbearance, and you won’t be eligible to receive additional student loans in the future. Any income tax refunds can also be garnished to pay off the loan, and your credit score is greatly affected.

If you are in default, you have a few options to correct, or start to correct, the problem. If you have the financial resources, the first option would be to pay the full amount of the defaulted loan. If this is not a possibility, individuals can enter into a loan rehabilitation program. Most programs require nine monthly payments, each made within 20 days of their due date, all within the period of ten consecutive months. Payment amounts are usually based on 15% of your discretionary income. Once the rehabilitation program is completed, the default status is lifted.

When your loans are under deferment, you have technically put them on pause. This can occur if you return to school (for a graduate degree, do instance), or are in the military. During this period, interest does no accrue on subsidized loans, however it does on unsubsidized loans. Borrowers must apply for deferment directly with their loan provider.

If the process is confusing, you are more likely to not take the proper steps to repay the loans. Being educated on important terms and policies can assist students in better understanding loan repayment and consequences. To that end, here are some more frequently used terms when it comes to student loans.

  • Annual percentage rate (APR): the interest connected to the loan.
  • Borrower: the individual who has signed the loan agreement and is responsible for loan repayment.
  • Consolidation: combining two or more loans into a new, single loan.
  • Forbearance: postponing or extending loan payments (while still accruing interest) due to a personal hardship.
  • Interest: a percentage of your loan balance that is charged by the lender during the course of your loan repayment.
  • Lender: the financial provider of the loan.
  • Principal: the full amount borrowed. When a student is still in repayment, the principal is the amount that is still to be paid.
  • Promissory note: a legally binding contract between borrower and lender with the terms of the loan.

The Dangers of Defaulting on Student Loans

Colleges that place importance on preparing their students for the workforce and world in order to best pay off their student loan debt are still up against increasing numbers of students who take out loans for school. In the U.S. alone, there are 44 million borrowers, totaling $1.3 trillion in student loan debt. Student loan rates are up, and the average graduate from the class of 2016 left campus with their diploma and $37,172 in loans to pay off. Nationwide, the student loan default rate is at 11.2%.

A 2012 edition of The Economist stated that “rising fees and increasing student debt, combined with shrinking financial and educational returns, are undermining at least the perception that university is a good investment.” A post-secondary education is becoming more and more expensive, leaving students to question how much the cost is worth, or being unable to manage the cost once they graduate.

When a student does not pay their loans for more than 270 days, they are considered in default. High student loan default rates can cause a wide array of negative consequences, from the smaller inconveniences like constant phone calls from creditors, to life-altering repercussions like wage garnishment.

These effects go beyond just the money, too. A 2014 Gallup Poll identified five main areas in which students with high levels of debt fall behind their counterparts without loans:

  • Purpose, or being motivated and liking what you do every day
  • Social, or having beneficial relationships in your life
  • Financial, or being able to manage your economic life
  • Community, or having pride in where you live
  • Physical, or being in good health with high levels of energy

Gallup found that students with more than $50,000 in student debt had decreased well-being, especially in the area of physical health, than that of those without loan debt. The American Student Assistance nonprofit, after conducting a study of nearly 1,000 participants, reported that 40% of students they questioned cited that student loans had impacted their health, and in multiple ways. First, the stress and worry that comes with the ownership of a large student loan can take their toll on a person’s health. Enough of it can impact sleeping and eating habits, and if it gets too much, can also lead to depression. This can create a snowball effect: less sleep means less productivity and motivation, which can lead to poor work performance.

Health is also a factor when it comes to student loan debt, as individuals are often tasked with deciding where to spend their money. Many times, the doctor is put off in favor of using limited resources somewhere else. Individuals might also place less priority on expensive health insurance or forego it altogether.

Defaulting on student loans can also impact your job prospects. Local, state, and federal agencies will not hire anyone who has defaulted on a student loan. Industries outside of the government often look at loan histories, too, as a way of weeding out candidates. The Society of Human Resource Management reported that 47% of employers engage in background checks of potential employees, to prevent “criminal, unreliable, or financially irresponsible candidates from being hired.”

Student loan debt also makes a negative impact on the economy at large. It reduces the amount of spending a person does. A 2015 study found that individuals with student loan debt have postponed buying a house (41%) and delayed plans to move to a larger city. Participants also cited potential plans for decreased spending in the future to help pay off loans, including cancelling gym memberships, foregoing regular haircuts, and reducing social activities with friends and family.

It also inhibits new businesses. A 2015 Gallup study found that one in five borrowers have postponed plans to start a business. And for those still willing to try, they might have a harder time receiving a business loan, as student debt can affect credit scores.

There are consequences to defaulting on loans, but there are also helpful tips and resources to keep you from getting to that point. First, don’t borrow more than what you need for college, and make sure the amount is in line with what you think you can pay back. Be sure to consider colleges with low loan default rates. If you can, start making small payments while you’re still in school (every bit helps!). If you know your proposed repayment plan is unrealistic, work with your provider to make it more manageable, so you aren’t behind the eight-ball before payments even begin. When it’s time to get your first job after college, take special note of companies who offer student loan benefits, like matching your monthly payment.

Student loans are often a necessary reality to complete a quality college education, but make sure to be prepared for repayment and loan management when you finish school. Completing a college degree should be a time of celebration and a promising new chapter in your life. Keeping your loans in check and taking steps to manage payments will help ease the transition from college to career and beyond.

RankSchoolStudent to
Faculty Ratio
Graduation
Rate
Retention
Rate
Acceptance
Rate
Enrollment
Rate
Institutional
Aid Rate
Default
Rate
401

Saint Francis University

14 to 172%87%74%22%84%N/A
402

Saint John Fisher College

12 to 172%86%62%12%96%N/A
403

Saint Joseph's College of Maine

12 to 158%86%78%20%56%N/A
404

Saint Joseph's College-New York

11 to 168%86%68%16%82%N/A
405

Saint Joseph's University

13 to 179%90%82%14%90%N/A
406

Saint Louis University

11 to 171%90%63%12%54%N/A
407

Saint Mary's College

10 to 179%90%80%24%94%N/A
408

Saint Mary's University of Minnesota

18 to 161%80%78%19%69%N/A
409

Saint Mary-of-the-Woods College

6 to 150%74%59%26%83%N/A
410

Saint Michael's College

11 to 176%87%76%10%98%N/A
411

Salve Regina University

13 to 172%86%73%12%81%N/A
412

Samford University

12 to 174%89%93%26%88%N/A
413

San Diego State University

28 to 168%89%34%9%59%N/A
414

Sessions College for Professional Design

15 to 160%90%N/AN/A53%N/A
415

Seton Hall University

13 to 163%84%76%10%86%N/A
416

Shasta Bible College and Graduate School

5 to 158%100%73%55%85%N/A
417

Simmons College

7 to 174%85%58%10%91%N/A
418

Skidmore College

8 to 186%94%36%8%48%N/A
419

Slippery Rock University of Pennsylvania

22 to 168%83%68%26%58%N/A
420

Southeastern Baptist College

6 to 180%40%N/AN/A21%N/A
421

Southwestern Assemblies of God University

14 to 141%74%28%20%87%N/A
422

Spring Arbor University

11 to 152%79%69%19%88%N/A
423

St Catherine University

10 to 157%86%67%14%89%N/A
424

St Lawrence University

11 to 187%89%46%12%93%N/A
425

State University of New York at New Paltz

15 to 173%89%42%7%53%N/A
426

Stevens Institute of Technology

10 to 182%94%44%10%92%N/A
427

Stevenson University

14 to 153%80%60%13%81%N/A
428

Stockton University

17 to 173%87%64%21%56%N/A
429

Stony Brook University

17 to 168%90%41%8%57%N/A
430

Summit University of Pennsylvania

11 to 159%74%61%32%74%N/A
431

Susquehanna University

12 to 171%89%76%13%98%N/A
432

Syracuse University

16 to 181%91%48%10%70%N/A
433

Taylor University

12 to 177%87%85%30%84%N/A
434

Temple University

14 to 171%90%56%17%72%N/A
435

Texas A & M University-College Station

20 to 179%90%67%31%57%N/A
436

Texas A & M University-Commerce

20 to 142%73%47%15%73%N/A
437

Texas Christian University

13 to 176%90%43%11%66%N/A
438

Texas Tech University

22 to 160%83%63%22%52%N/A
439

The Baptist College of Florida

11 to 151%76%52%29%97%N/A
440

The Christ College of Nursing and Health Sciences

10 to 169%83%54%29%68%N/A
441

The College of Saint Scholastica

15 to 170%84%61%12%82%N/A
442

The Master's College and Seminary

10 to 169%85%95%41%82%N/A
443

The Sage Colleges

12 to 160%78%54%11%90%N/A
444

The University of Alabama

24 to 167%86%54%20%57%N/A
445

The University of Findlay

16 to 156%78%76%23%92%N/A
446

The University of Texas at Arlington

25 to 146%71%66%26%54%N/A
447

The University of Texas at Austin

18 to 180%95%39%18%45%N/A
448

The University of West Florida

22 to 147%72%42%19%63%N/A
449

Toccoa Falls College

13 to 147%66%45%20%93%N/A
450

Towson University

17 to 170%86%73%25%47%N/A
451

Truman State University

16 to 173%89%79%32%80%N/A
452

Tufts University

9 to 193%97%16%7%43%N/A
453

Tulane University of Louisiana

9 to 183%92%30%7%70%N/A
454

Union University

10 to 164%84%69%19%74%N/A
455

Unitek College

16 to 1N/A100%N/AN/A20%N/A
456

University at Buffalo

13 to 174%88%60%15%55%N/A
457

University of Alabama at Birmingham

18 to 155%79%60%21%58%N/A
458

University of Arkansas

19 to 162%82%60%24%58%N/A
459

University of California-Berkeley

17 to 192%96%17%7%61%N/A
460

University of California-Davis

18 to 185%93%38%8%72%N/A
461

University of California-Irvine

19 to 188%93%39%8%73%N/A
462

University of California-Los Angeles

16 to 191%96%17%6%61%N/A
463

University of California-Merced

18 to 166%84%61%9%88%N/A
464

University of California-Riverside

19 to 173%91%56%11%84%N/A
465

University of California-Santa Barbara

17 to 181%93%33%6%66%N/A
466

University of California-Santa Cruz

18 to 178%88%50%8%74%N/A
467

University of Central Florida

30 to 170%89%49%18%69%N/A
468

University of Cincinnati-Main Campus

18 to 162%88%86%29%58%N/A
469

University of Connecticut

17 to 183%92%53%11%62%N/A
470

University of Dayton

16 to 179%91%58%13%86%N/A
471

University of Delaware

16 to 179%92%67%18%62%N/A
472

University of Denver

11 to 177%86%73%9%80%N/A
473

University of Florida

20 to 187%96%48%24%88%N/A
474

University of Florida-Online

35 to 1N/A88%56%51%55%N/A
475

University of Georgia

18 to 185%95%53%24%82%N/A
476

University of Idaho

16 to 157%80%72%26%67%N/A
477

University of Illinois at Chicago

18 to 160%81%77%22%65%N/A
478

University of Illinois at Springfield

14 to 148%77%63%18%65%N/A
479

University of Illinois at Urbana-Champaign

19 to 185%93%66%22%51%N/A
480

University of Iowa

15 to 172%85%81%20%58%N/A
481

University of La Verne

17 to 164%85%47%9%73%N/A
482

University of Mary

13 to 160%75%96%46%86%N/A
483

University of Maryland-Baltimore County

19 to 163%86%59%15%51%N/A
484

University of Maryland-College Park

17 to 186%95%45%14%52%N/A
485

University of Massachusetts-Amherst

18 to 178%91%58%12%69%N/A
486

University of Massachusetts-Lowell

17 to 156%86%57%15%55%N/A
487

University of Memphis

14 to 145%77%40%13%76%N/A
488

University of Miami

12 to 182%92%38%6%70%N/A
489

University of Michigan-Ann Arbor

12 to 190%97%26%12%51%N/A
490

University of Michigan-Dearborn

15 to 153%80%62%18%63%N/A
491

University of Minnesota-Twin Cities

17 to 177%93%45%13%50%N/A
492

University of Missouri-Columbia

20 to 169%87%78%28%60%N/A
493

University of Nebraska at Kearney

14 to 156%80%85%37%71%N/A
494

University of Nebraska-Lincoln

21 to 167%83%76%48%52%N/A
495

University of New England

13 to 165%75%85%14%80%N/A
496

University of New Hampshire-Main Campus

19 to 179%85%79%17%58%N/A
497

University of North Carolina Wilmington

17 to 171%85%61%18%53%N/A
498

University of North Carolina at Chapel Hill

14 to 190%97%31%13%53%N/A
499

University of North Carolina at Charlotte

19 to 153%83%63%21%52%N/A
500

University of North Carolina at Greensboro

17 to 156%77%59%26%55%N/A

Methodology

For each college, we gathered data for nine different metrics: the number of full-time faculty per part-time faculty member; institutional financial aid, acceptance, retention, graduation, job placement, and default rates; years accredited; and undergraduate tuition. Learn more