DOE Report Says UNCF-Member HBCUS Make Significant Progress on Student Loan Default Rates
UNCF-member historically black colleges and universities (HBCUs) made significant progress in reducing student loan defaults rates, according to FY 2013 Cohort Default Rate data released last week. Two-thirds of the 37 HBCUs supported by UNCF reduced their FY 2013 Cohort Default Rates (CDRs) compared to the prior year, and some institutions cut default rates by 40 percent or more over the last two years.
“UNCF-member institutions have devoted tremendous time, resources and effort to reduce student loan defaults, all while using scarce funds to do their part, and these efforts are paying off,” said Dr. Michael L. Lomax, UNCF president and CEO. “Now, federal policymakers must step up to the plate to provide debt relief and better student loan services to the 80 percent of HBCU students who must borrow to get to and through college.”
Notably, all 101 eligible HBCUs produced three-year CDRs that fall below the 30 percent regulatory threshold. HBCUs were recognized by the Education Department for innovative approaches toward default management and reduction, including best practices such as tracking measureable goals, engaging students at orientation with borrower topics, enhanced entrance and exit counseling, increased contact with delinquent borrowers and borrower tracking.
For additional progress on student loan debt, delinquencies and defaults, UNCF recommends that federal policymakers:
- Reduce the need for low-income students to borrow by increasing grant and work-study opportunities
- Make federal student loans less costly for students and their parents
- Hold federal student loan servicing contractors accountable for serving students at a high level
- Establish a single, simple and automatic income-based repayment plan for all federal student loan borrowers
UNCF (United Negro College Fund) is the nation’s largest and most effective minority education organization. To serve youth, the community, and the nation, UNCF supports students’ education and development through scholarships and other programs, strengthens its 37 member colleges and universities, and advocates for the importance of minority education and college readiness. UNCF institutions and other historically black colleges and universities are highly effective, awarding 20 percent of African American baccalaureate degrees. UNCF annually awards $100 million in scholarships and administers more than 400 programs, including scholarship, internship and fellowship, mentoring, summer enrichment, and curriculum and faculty development programs. Today, UNCF supports more than 60,000 students at more than 1,100 colleges and universities across the country. Its logo features the UNCF torch of leadership in education and its widely recognized trademark, “A mind is a terrible thing to waste.”® Learn more at UNCF.org, or for continuous news and updates, follow UNCF on Twitter, @UNCF.