On September 27, 2021, the Official Cohort Default Rates were released for the 2018 Fiscal Year.

Since 2013, the National Student Loan Cohort Default Rate has been trending down. The official 2018 rate is now 7.3%, down from last year’s (2017) rate of 9.7%

According to Federal Student Aid’s National Default Briefing, the highest Defaults are still coming from the proprietary school sector which has an average Default Rate of 11.2% for the 2018 CDR. Public institutions fared much better at 7.0%, followed by private institutions with just 5.27% of students defaulting on their loans. Still, within each sector there are interesting outliers. For example, Public 2–3-year institutions came in at 11.5% roughly the same as the average of the Proprietary sector. Private, less than 2 years were 11.9% and private 2–3-year schools came in at 12.1%.

The Fiscal Year 2018 Three-Year CDR is calculated by dividing the number of borrowers who entered repayment in 2018 by the number of borrowers who entered repayment in 2018 and defaulted in 2018, 2019 or 2020. A school with a high default rate will face sanctions and may lose its eligibility to participate in Federal Student Aid Programs or expand their scope of participation with ED. Schools with Three-year CDRs of 30% or greater for three consecutive years or with CDRs greater than 40% for one year are subject to federal sanctions.

The official Three-Year rates were sent to all schools via their Student Aid Internet Gateway (SAIG) mailbox. Federal Student Aid’s Operations Performance Management Services calculates the rates which measure the ratio of students who enter repayment during a cohort year and who later default on those loans. Since the data isn’t always right, schools can challenge and appeal their CDR calculation to have their rates adjusted. Schools may begin submitting challenges and appeals on, October 6, 2021, though this year FSA is instructing schools that wish to file the following appeals via email:

  • Participation Rate Appeal
  • Economically Disadvantaged Appeal
  • Erroneous Data Appeal

Uncorrected Data Adjustments and New Data Adjustments may still be filed through the eCDR Appeals website. The deadline to file FY 2018 Official Cohort Default Rate Appeals is November 4, 2021. For more information, including the special email address for the appeals mentioned above, check out this electronic announcement from Federal Student Aid.

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