The U.S. Department of Education announced Wednesday that students who began repaying loans in 2011 are defaulting at a lower percentage than their 2010 counterparts. The new figure, 13.7%, is down from 14.7% in 2010. The drop, according to the DOE, was “across all sectors of higher education,” including public, private and for-profit institutions.
The drop in the percentage of students defaulting on their loans, however, comes as a higher number of students are making repayments. In fact, the DOE said that there are 650,000 more students who entered repayment in 2011 as compared to the year before.
The figures were tabulated from the period between October 1, 2010 and September 30, 2011 and who defaulted before September 30, 2013, according to the DOE. During that period, 4.7 million borrowers entered repayment,while 650,000 defaulted on their loans.
“While it’s good news that the default rate decreased from last year, the number of students who default on their federal student loans is still too high, and we remain committed to working with postsecondary education institutions and borrowers to ensure that student debt is manageable,” said Secretary of Education Arne Duncan in a statement. “The Department will continue our efforts to help borrowers by providing more flexible repayment options and better counseling and information.”
The news that less students are defaulting on loans comes after President Barack Obama directive in June that the DOE “allow all federal student loan borrowers to cap their monthly payment amounts at 10 percent of the borrower’s monthly income,” according to the release.
Earlier in September, Occupy Wall Street made headlines for forgiving nearly $4 million in student loan debt through its Rolling Jubilee Fund.
