According to Director of Financial Aid Jennifer Garratt Lawton, University students are paying off their Stafford Loans on time, with few students lagging in payments. Earlier this week, the Office of Financial Aid learned that the University has a 1.1 percent default rate on federal student loans, which translates to four students per year who do not pay on time.

“A loan is considered to be in default when a borrower falls behind in payments by 180 days or more,” Lawton said. “There are many opportunities for borrowers to keep their loans in good standing through the use of deferments and forbearance applications, so a borrower who is having difficulty making their payments should always keep the lines of communication open with the lender to see what can be worked out.”

In the Feb. 13 issue of “Forbes” magazine, a study entitled, “Ranking the Academic Elite by Deadbeats,” stated that in 2003, the University had one of the highest default rates on federal student loans at 2.0 per cent. The data was for the 100 top-ranked national universities and liberal arts colleges in the U.S. and cited that at the time, the overall U.S. average was 4.5 per cent.

“’Forbes’ has the stature that [the study] might get picked up and repeated,” Lawton said. “I’m glad to see that at the very bottom they sort of set the context. I think it’s showing that we’re doing a good job, a better-than-average job, of making sure our students get into some sort of satisfactory payment arrangement.”

In any given year, approximately 425 students participate in the Stafford Loan program. After college, the majority make payments on time, something Lawton attributes to good communication between students and loan officers. She also believes that being able to pay off loans is one advantage of completing a Wesleyan education.

“When it comes to searching for their first jobs Wesleyan students have a bit of an advantage because Wesleyan is a recognized name,” Lawton said. “They have a good success rate in terms of getting a job right out of college. Lending partners work with our students very closely to make sure they have knowledge of all of the options when they go into repayment so if students do find themselves unemployed our loan services are good at making sure students have all info they need about their options concerning payment.”

Students who fall behind in payments can expect to be contacted via phone and mail, and to ultimately have their wages garnished until they pay up.

“Even when a student goes into default there are ways to remedy that,” Lawton said. “They need to be in communication with the loan servicer. I think a lot of times it has to do with not knowing that students have options.”

The federal government manages the cohort default rate for all schools that participate in direct lending. If a university’s rate is too high, it risks losing eligibility to participate in Title IV programs at the school, like the Stafford Loan program, Pell Grants, Supplemental Educational Opportunity Grant (SEOG) Grants, Perkins Loans, and work study.