August 13, 2013

Colleges With the Highest and Lowest Student Loan Default Rates

Little while back DQYDJ mentioned in an article that 30% of people in repayment on their student loans are in default.  That number was shockingly high to me.   I'm still puzzled why its so high.   But anyway after reading that I was looking into default rates on student loans and I came across a page on the Dept. of Education site that lists the student loan default rate by university.   The data they have is from 2011 and looked at 2008 so its a bit out of date.   Unfortunately the default rates have apparently gone up significantly since '08.

I thought it would be interesting to see the list of schools with the highest and lowest default rates and so here they are.    I filtered the list to only look at schools with at least 100 students.   I noticed a few schools with the worst rates only had 1-4 students listed so that threw things off.

You can draw your own conclusions about what high or low default rates mean.   

First he bad news, schools with the highest default rates.

These are the FY 2008 two year cohort default rates with at least 100 students: .

School State Default
Academy Of Healing Arts NV 46.89
Everest Institute TX 35.28
Tucson College AZ 34.65
Aviation Institute Of Maintenance IN 32.52
Everest College CA 31.17
Lamson College AZ 30.48
Pennsylvania School Of Business PA 30.09
Centro De Estudios Multidisciplinarios PR 29.57
Talladega College AL 29.41
Wyotech FL 29.20
California Healing Arts College CA 28.71
Institute For Business & Technology CA 28.33
Plaza College NY 28.06
Institute Of Technology CA 28.01
Everest Institute FL 27.62
Everest College MO 27.56
College Of Office Technology (The) IL 27.38
Career Institute Of Health And Technology NY 26.88
Lincoln College Of Technology TX 26.34
Everest College CO 26.24
West Hills Community College CA 25.97
Dudley Nwani The School TN 25.93
Kaplan Career Institute OH 25.76
Everest Institute NY 25.71
Newbridge College - San Diego East CA 25.68
Ntma Training Centers Of Southern California CA 25.48
Everest College WA 25.27
Prism Career Institute PA 25.00

Most of the schools are for profit trade schools.  I see one school there that is obviously public, the West Hills Community College.   Everything else there looks like a for profit school.   Oh and "Institute of Technology" in California should not be confused with the California Institute of Technology.

Why do these schools have such high default rates?    I don't know.   One reasonable guess might be that they do not adequately prepare their students for the job market and thus present a poor educational value.   But thats just one theory.  I suppose there could be other potential reasons.

Now the Good news, the schools with ZERO defaults

There are a full 39 schools in the list with at least 100 borrowers and absolutely 0 defaults.   Those schools are :

Albany College Of Pharmacy And Health Sciences
Albany Medical College
Amherst College
Award Beauty School
Barnard College
Carleton College
Carroll College
College Of Saint Benedict
Concordia Seminary
Connecticut College
Davidson College
Eastern Virginia Medical School
Edward Via Virginia College Of Osteopathic Medicine
Erskine College
Haverford College
Illinois College Of Optometry
Kalamazoo College
Kansas City University Of Medicine And Biosciences
Lancaster General College Of Nursing And Health Sciences
Luther Seminary
Mayo Clinic, College Of Medicine
Medcentral College Of Nursing
Medical College Of Wisconsin
Muhlenberg College
Nebraska Methodist College Of Nursing & Allied Health
New England College Of Optometry (The)
Ross University School Of Veterinary Medicine
Saint Mary'S College
Southern California College Of Optometry
St. John'S College
Thunderbird School Of Global Management
Tui University
University Of London - London School Of Economics & Political Sci
University Of Massachusetts Medical Center
Vermont Law School
West Coast University
Williams College
Wisconsin Lutheran College
Wofford College

I don't recognize most of these but I do see several medical schools on that list.

Now this doesn't mean you should rush out and enroll in one of the 39 schools listed above without defaults.  I have no idea why their students haven't defaulted. 

I was curious and looked up my own alma matters and found that one was just a bit over 1% and the other was a little over 5%.   I wasn't surprised by either.

Whats the default rate for your school?   Is it a surprise?


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