If you’re thinking about going to college, you may already know that where you go to school and what you study will determine the amount you may need to borrow and your ability to repay your student loan debt. That can feel overwhelming if you don’t know how to easily compare your options. The U.S. Department of Education’s College Scorecard can help, and recent changes to the tool make it easier to compare average earnings and student loan debt outcomes.
The College Scorecard was designed to help students decide which school to attend and what to study. Users can search and compare data from different schools and fields of study, including average college costs, admissions information, graduation rates and more.
Prospective students may consider using the tool to narrow down a search or choose between different schools or fields of study. Users should keep in mind that the data displayed within College Scorecard are averages, which means the tool doesn’t provide an exact picture of what you may actually borrow, pay back or earn. However, it can help you understand how chosen schools fare on different metrics and identify outliers, or assess the return on investment for a chosen program of study.
New data was recently added to the tool that can help users think about student debt outcomes. As student loan debt levels remain a national concern, it’s critical that prospective students consider the total amount of debt they will incur to earn a college degree, as well as their ability to repay that debt after graduation or dropping out.
Here’s a look at what has been added to the College Scorecard and how you can use that information.
Borrower Outcomes in Student Loan Repayment
Earning a college degree is typically a smart investment that leads to higher earnings over time, even when students need to borrow to pay for the education. However, some borrowers in repayment fare better than others, and this metric can indicate how well an institution is preparing its students for success after graduation.
In a prior update, the College Scorecard added new data showing the median federal loan debt graduates leave with by program of study. A more recent update announced last month provides more detailed information on how well borrowers from individual schools are progressing toward repaying their federal student loans.
It shows the percentages of borrowers who fall into eight loan repayment statuses two years after entering repayment: paid in full, making progress, delinquency, forbearance, deferment, default, not making progress and loans discharged.
Note that borrowers in the “not making progress” category are making regular payments, but the sum of all outstanding loan balances exceeds the sum of the original loan balances — meaning that the amount owed is growing rather than decreasing due to unpaid interest. This is called negative amortization and ends up costing the borrower more over time.
The data on student loan delinquencies, defaults and forbearances are also worth reviewing. If a college has a high number of borrowers in these categories, it might be cause for further research about why so many students who attended that school are struggling to repay their loans.
Another helpful update to the College Scorecard last month is the addition of data on the percentage of student loans paid down by cohorts of federal student loan borrowers one year, four years, five years, 10 years and 20 years after entering repayment. This information can indicate how well or poorly students at a given school have fared at paying back their student loans over time.
Parent PLUS Loan Information
Alongside more student borrowing information, the College Scorecard also made an update in December 2020 that allows users to see how much parents are borrowing in federal Parent PLUS loans to help their children pay for college. This data helps provide a more comprehensive understanding of borrowing at a given institution.
At the end of 2019, about 3.6 million parents had taken out Parent PLUS loans to help their children pay for college, per a study by Trellis Research — but this data was previously not reported on the Scorecard. Parent PLUS loans are meant to help families pay for any remaining tuition owed after a student has applied all of his or her other federal student loans, grant aid, scholarships and other available resources.
Scorecard users can now see the parent borrowing rate, median total debt after graduation and the typical monthly loan payment for the Parent PLUS program at each college. This information can provide a better understanding of average outcomes for parents who borrow to help their child attend a particular school or schools and assess whether most students are relying on Parent PLUS loans to fill a tuition gap. It can also help parents understand what their monthly payments might look like if they choose to borrow through the Parent PLUS program.
While these updates provide a more complete picture of college loan debt, the tool still does not include data about private student loans, so it’s important to know that some borrowing may not be accounted for.
Average Earnings by Program of Study
This specific update from December allows students to compare average earnings two years after graduation based on field of study. Prospective students can compare across programs of study at one college or compare outcomes in the same field at multiple schools. Over time, more long-term data will be included as future earnings data becomes available.
This information is particularly useful for individuals looking to assess the return on their investment for college — one of the factors that should be taken into consideration when choosing a program of study. It’s also important when thinking about how much to borrow, since your ability to repay your student loans will be based largely on your job wages or salary after you leave school.
The College Scorecard can be a useful tool, but it’s important to keep in mind that everything it provides is an average. Real-life outcomes can be higher or lower than the average, so the tool should be just one consideration among many when choosing a program or college, including finding the best fit based on your personal preferences.
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What to Know About Additional College Scorecard Student Loan Info originally appeared on usnews.com