The federal government’s efforts to track student-loan-default rates and graduation rates are sending some students down the wrong path, according to a report released on Tuesday.
In the report, Education Sector, an education-policy group, calls on the U.S. Department of Education to pair the default rates and graduation rates, instead of releasing the numbers separately, to arm potential students with more-complete information.
The report, “In Debt and in the Dark: It’s Time for Better Information on Student-Loan Defaults,” by Education Sector’s research director, Andrew Gillen, also highlights colleges where default rates exceed graduation rates—a combination that it says should “set off a red flag in the minds of prospective student borrowers—and their parents.”
Looking at institutions where at least 30 percent of students borrowed and default rates exceeded graduation rates, the report identifies 265 “red flag” colleges, most of which are for-profit institutions and community colleges. <Read more.>