Times may be tough, but some students are still managing to make payments on their student loans. The U.S. Department of Education just released an extensive list of colleges where students have the best -- and worst -- track record of repaying their loans -- and some interesting trends have emerged.
U.S. News and World Report sorted through the list, which ranked 8,412 colleges, job training programs, and graduate schools across the country. One finding: students at nursing schools and institutes of technology are among the most diligent about paying their student loans. Among the top 20 colleges on the list, are the California Institute of Technology (CalTech) and Medcenter One College of Nursing located in Bismark, North Dakota, both of which saw more than 90% of students repay their loans in 2009.
Among the colleges with some of the lowest payback rates, according to U.S. News, were historically black colleges like Grambling State, Fisk, Tougaloo, religiously-oriented colleges such as the University of Mobile and Liberty University, and some urban colleges like Detroit's Wayne State and Georgia State. The report notes that beauty schools and other for-profit trade schools are listed at the bottom, as well.
Not everyone is happy about the government's report. As U.S. News reported, schools at the bottom of the list are complaining that the qualifications for repayment are too tough. In order to be counted as repaying, students had to have put at least $1 toward principal repayment between October 2008 and September 2009. If a student went on to grad school and got the standard deferment, they weren't counted. Harris Miller, president of the Career College Association, complained that even if students are following all the rules, they can be classified as non-payers, which makes the schools look bad.
Georgia State Provost Tim Renick was disappointed the Department of Education didn't take income into account before publishing his college's low rate of repayment (44%). Half of Georgia State's students come from low-income households and qualify for Pell Grants. Renick told U.S. News that he'd prefer it if the Department of Education released data revealing how much or little a college helps students with financial aid.
Others complained that the numbers were too lenient about repayment. Sarah Flanagan of the National Association of Independent Colleges and Universities told U.S. News that using $1 as the benchmark repayment standard was "very generous" to colleges. The list also doesn't take into account private student loans, meaning it may paint an unrealistic picture of the amount students actually borrow and how much they're able to repay.
Which students are best at paying back college loans?