College Track: 2019 Social Mobility Report 2019 Social Mobility Report - Page 10

COLLEGE TRACK FRESH GRADUATES EARN ENOUGH TO PAY BACK THEIR LOANS Graduates who work full-time are able to repay their loans , provided they did not borrow more than $ 30,000 . While our proportion of borrowers is constant year-over-year , the average debt is higher . We anticipated this trend , and we started communicating the $ 30,000 threshold to our younger cohorts several years ago . Now , we proactively guide them to “ Best Fit Colleges ,” institutions where the average debt for our graduates is four times smaller than at what we call “ expensive colleges ” ( small liberal arts colleges , Art schools , and HBCUs ). We found that our 2017 graduates from such colleges borrowed over $ 45,000 to pay for their Bachelor ’ s degrees compared to $ 10,000 for those who attended Best Fit Colleges ( primarily flagship public institutions ). 5
COLLEGE TRACK • POST-COLLEGE OUTCOMES
At their first job , College Track graduates who borrowed >$ 30k can repay their loans within 10 years Step 1 Step 2 Step 3
College Track graduates take out average loans *
Those with loans under $ 30k can repay with first job salaries
Graduates from Best Fit Colleges have the lowest loans **
75 % borrowed less than $ 25k and can definitely repay
Loans Upon Graduation ***
$ 46,000
$ 27,000
$ 23,000
VS
$ 24,500
7 % borrowed $ 25-30k and can likely repay
18 % borrowed more and less likely to repay
$ 10,500
$ 12,500
Louisiana
* Compared to 50 % of graduates in California and 48 % in Louisiana ; TICAS ( 2018 ), Student debt and the class of 2017 . ^We use the federal gainful employment rule for colleges ; loan repayment should not exceed 8 % of income . This is based on a small sample study of 16 borrowers with full-time jobs .
** On par and likely better than graduates from similar backgrounds : NCES ( 2017 ) Repayment of Student Loans as of 2015 found an 8 % default rate among all Bachelor ’ s degree holders and a 35 % default rate among Pell grant recipients ( regardless of whether they graduated ), 3 times higher than non Pell grant recipients . So default rates for low-income graduates is likely higher than 18 %.
*** Includes non-borrowers
California
College Track
Best Fit N = 19
Public College N = 8
Arts / HBCU N = 6
College Track Page 10