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PEDAR: Executive Summary Debt Burden Four Years Later
Borrowing for Education
Debt Status in 1997
Debt Burden
Research Methodology
Full Report (PDF)
Executive Summary (PDF)
Debt Burden in 1997

The debt status of the 1992–93 bachelor’s degree recipients in 1997 can be summarized as follows: 46 percent did not owe any money because they had never borrowed at either the undergraduate or graduate levels; another 16 percent had borrowed at one or both levels, but no longer owed on those loans; and the remaining 39 percent still owed on education loans.

The summary figure shows the percentages who borrowed, still owed, and were in repayment in 1997, by education status as of 1997. It also shows the associated average amounts in each case. Too few doctoral students had completed their degrees by 1997 for reliable estimates of their debt status. The difference between the percentages who borrowed and who still owed represents the proportion who had repaid their loans (or had them forgiven) by 1997. The difference between the percentages who still owed and who were in repayment represents the proportion with deferments, who were in default, or who were not required to repay loans at that time. The summary figure also shows the average amounts borrowed and owed, and the average being paid on a monthly basis.

The 1992–93 bachelor’s degree recipients who had borrowed as undergraduates but had not enrolled for any further education had made some progress in eliminating their debt by 1997. Among 1992–93 bachelor’s degree recipients who had not enrolled for any additional postsecondary education by 1997, 51 percent had borrowed for their undergraduate education, and 33 percent still owed on those loans in 1997. Thus, 18 percent had paid off their education debts (or had them forgiven). Almost all of those who owed were in repayment (the difference between the 33 percent who owed and the 29 percent who were in repayment is not statistically significant). (see summary figure.)

Among 1992–93 bachelor’s degree recipients who had earned a master’s degree by 1997, 69 percent had borrowed at one or both levels. By 1997, about 14 percent had been able to discharge their debt despite earning a second degree, and 55 percent still had outstanding loans. Thirty-nine percent were making payments, which means that about 16 percent were not being required to make payments, most likely because they had just recently completed their degree and were still in deferment. The average amount still owed by master’s degree holders was substantially greater than the amount still owed by those who had not enrolled for further education ($17,200 versus $7,100). (see summary figure.)

Among 1992–93 bachelor’s degree recipients who had earned a first-professional degree by 1997, 91 percent had borrowed to help pay for their education, and most (80 percent) still owed on their loans. Because first-professional programs usually take at least three or four years to complete, most would have graduated very recently. Thus, a comparatively low proportion (47 percent) were in repayment in 1997. The average amount owed by this group ($66,200) was substantially higher than the average amount owed by those who had completed a master’s degree ($17,200), This difference reflects higher tuition, more frequent full-time enrollment, limited time to work while enrolled, and little time after undergraduate enrollment to accumulate savings. (see summary figure.)

Although it appears that the average amount owed is greater than the average amount borrowed for those who had completed a first-professional degree ($66,200 versus $63,400), the difference is not statistically significant. It is likely that the few who no longer owed had taken out relatively small loans, leaving those with high loan amounts still owing. This would have the effect of raising the average amount owed after the smaller loans were removed. Furthermore, some borrowers may have had the accrued interest on their loans added to the principal while they were enrolled and thus increased the amount owed. (see summary figure.)

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