How to Avoid Defaulting on Student Loans

Barry Lenson

Students in Record Numbers are Defaulting on Loans . . . 

“College students defaulting at record rate,”an article that Meghan Hoyer wrote forUSAToday, reports some sobering statistics that have just been released by the U.S. Department of Education.

  • Last year's 8.8% default rate surged to 13.4% this year.
  • Nearly half of defaulting borrowers attended for-profit colleges, despite the fact that they make up only 28% of the total borrowing pool, and 13% of all enrolled college students.

That’s all pretty bad. But let’s turn for a moment to a question that could be closer to your own heart. How can you avoid borrowing too much to pay for college, then being unable to pay it back?

Some of the answers to that question seem overly simple. But if you stop to think about them, you’ll see that they make a lot of sense . . .

  • First, you can finish college faster. You can take AP tests, place out of courses, take exams that let you earn college credit for life experience, and apply other time-cutting tactics. You can read about them in a blog post that I wrote last July.
  • Second, you can start at an inexpensive community college and transfer to a larger state school. You can read about that strategy in another blog post that ran here last August.
  • Third, you can slash the costs of your education by taking college courses online, and then transfer your credits to your regular college.That’s one of the most important reasons that students come to StraighterLine. They’ve even discovered that they can complete their first year of college for $999.

So if borrowing and defaulting are worrying you, you can loosen your collar and relax a bit. The best way to avoid owing a ton of money is to avoid borrowing it in the first place. The three simple strategies outlined above can help.


Related Readings

Applying for Scholarships Or as I like to call it, “Winning at Tuition”
Unusual Sources of Financial Aid
Don’t Read This Unless You Want To Help People
Connecticut Woman Sells Historic Baseball to Pay off Her Son’s Med School Debt

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