Student Loan Default Highest for Causal Students

Here is still another reason to persuade the 'causal' student to not attend a university or college as it will only be a waste of time and money. There are many reasons why the average student attends a higher educational institutions, but the worst is everyone else is going.

Attending a local technical institution to gain a marketable skill that will actually bring in more money then if they attended a four or five year university, and graduated with a degree that will not support them as the market for general subjects education as business or the arts is so small.

Americans with the Highest Student Debt Are More Likely to Pay Loans
Source: Josh Mitchell, "Who's Most Likely to Default on Student Loans?"  Wall Street Journal, February 19, 2015.

February 23, 2015

A new trend among Americans has emerged: Debtors are more likely to pay back their loans the more money they borrowed for school compared to those who borrowed less. Why? Americans with larger student loans have accumulated the debt by enrolling in longer and more expensive educational programs, such as medical school and law school. However, these borrowers typically earn much higher salaries, allowing them to repay their loans with greater ease.

In contrast, those with less student loan debt are usually college dropouts who attend college for a couple semesters without earning a degree. Unable to find a job that pays enough to make the minimum payments, they ultimately lack the income to repay the balance. Borrowers default after not making a payment for 270 days.
Consider:

• One third of those owing less than $5,000 have defaulted since December 31, 2014, more than one-fifth of individuals with outstanding student loans.
• Meanwhile, the default on loans exceeding $100,000 is only 17.6 percent.

Americans with the highest student debt but earning higher salaries are also more likely to opt into income-based repayment programs, which experts maintain disproportionately favor high-income earners.