Average College Debt Rose to $24,000 in 2009

Average College Debt Rose to $24,000 in 2009
By TAMAR LEWIN
Copyright by The New York Times
Published: October 21, 2010
http://www.nytimes.com/2010/10/22/education/22debt.html?_r=1&hpw


College seniors who graduated in 2009 had an average of $24,000 in student loan debt, up 6 percent from 2008, according to an annual report from the Project on Student Debt.

The increase is similar to those of the past four years, the report said, despite the recession, probably because members of the class of 2009 took out most of their debt before the economic downturn began.

“This consistent growth in debt over the last few years really adds up,” said Lauren Asher, president of the Institute for College Access & Success, the research and advocacy group that operates the debt project. “It’s important to remember that the experts all agree that if you’re going to borrow, you should take out federal loans first, because federal student loans come with far more repayment options and borrower protections than other types of loans.”

In troubled economic times, Ms. Asher said, the income-based repayment and unemployment deferment available on federal loans are especially important.

Using a different data set, Sandy Baum, an economics professor who has analyzed debt for the College Board, found similar average debt loads, and also stressed the benefits of federal loans over private ones.

Many of the high-debt states are in the Northeast, while the low-debt states are clustered largely in the West.

Paying back student loans is likely to be especially difficult for recent graduates, the report said, because the unemployment rate for college graduates ages 20 to 24 was 8.7 percent in 2009 — the highest annual rate on record and a substantial rise from 5.8 percent in 2008.

“The unemployment rate is higher than ever for everyone, including people who didn’t go to college, and obviously that’s a huge concern,” Dr. Baum said.

The student debt project’s averages are based on voluntary reports from about 1,000 public and private nonprofit four-year colleges. For-profit colleges were not included, because very few report their student debt data, but surveys by the Department of Education indicated that generally, their graduates borrowed more than those who attended public or private nonprofit colleges. The unemployment figures are based on unpublished data from the federal government’s Current Population Survey.