Throughout this discussion, it is important to note that our analysis is descriptive and, while suggestive, does not necessarily imply causation. To answer these questions, we utilize a unique data set that matches the New York Fed Consumer Credit Panel (CCP), based on Equifax data, to National Student Clearinghouse (NSC) education data, allowing us to track student debt and educational attainment over time for a representative sample of young adults. Are students from less advantaged backgrounds more likely to default than students from more advantaged backgrounds?.Does college selectivity (defined below) matter for this relationship, and for student loan default more generally?.How do default rates of dropouts compare to those of graduates, and does this relationship vary by degree program?.Do default rates differ by college type?.To better understand the determinants of student loan default, we ask the following questions in this blog post: Since defaulting on student loans can have serious consequences for credit scores and, by extension, the ability to purchase a home and take out other loans, it’s critical to understand how college and family characteristics correspond to default rates. Of students who left college in 20, 28 percent defaulted on their student loans within five years, compared with 19 percent of those who left school in 20. In addition, the fraction of students who default on those loans has grown considerably. Student indebtedness has grown substantially, increasing by 170 percent between 20. This post seeks to understand how educational characteristics (school type and selectivity, graduation status, major) and family background relate to the incidence of student loan default. ![]() Rajashri Chakrabarti, Nicole Gorton, Michelle Jiang, and Wilbert van der Klaauw
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