Student Loan Debt: Breaking the bank for college graduates

Student Loan Debt: Breaking the bank for college graduates
(Source: WTOL)
(Source: WTOL)

(WTOL) - Getting an education is breaking the bank for many college graduates.

This time of year many high school seniors are celebrating their graduations, gearing up for life as a college coed. But the expense of that education is leaving students saddled with debt.

The average graduate will end up with around $30,000 in student loan debt, and with interest the total amount graduates have to repay could be double that.

"It doesn't actually hit you until you have to start paying it back," said former UT student Jordan Halsey.

So, it's likely no surprise that many graduates are finding it difficult to pay. According to the Department of Education, the average student loan default rate, that's the percentage of graduates who can't pay their loans, is at just under 12 percent.

Halsey says he didn't get much help from the university when it came to finding a job, and he struggled after graduation.

"A lot of uncertainty, certainly regret, thinking that I made a really, really bad decision of taking out that much loans that really isn't going to help me in the long run," said Halsey.

WTOL 11's Emily Nelson analyzed the student loan default rates for the colleges and universities here in Northwest Ohio and found default rates for both BGSU and UT fall below the national average. At Tiffin University, however, nearly 25 percent of graduates can't pay their loans. These rates are also a predictor of how difficult it could be to find a job after graduation.

"It's something that we're constantly looking and seeing what we can do," said Sherry Jiannuzzi, assistant director of loans at UT.

The financial aid department at Tiffin University declined a request for an interview.

"The last time we checked we had about 69 percent that were borrowing from the federal programs," said Jiannuzzi.

She says UT is working to educate students on responsible borrowing, and it's in the school's best interest. If a college or university's student loan default rate gets too high, students might not be able to get any loans at all.

"The other problem with the default rate as it gets into the 30s, like you were saying, is you run the risk of losing federal funds for your students all together," said Jiannuzzi.

That means students would likely need to rely on costly private loans, scholarships or self-funding.

But it's not just where you decide to attend school that impacts your ability to pay, what you major in matters too. Those graduating with art or education degrees tend to have lower incomes and unemployment rates, while those with nursing and engineering degrees see better job placement with higher than average starting salaries.

"My advice would be actually get some practical work experience before you commit to taking out those loans," said Halsey.

After graduating from UT with a business degree, Halsey says he had trouble finding work. He also realized he lacked passion for his chosen profession.

"And the pay that was starting at those positions was much lower than I expected," said Halsey.

He went back to school to get a master's degree in social work through a work/study program that allowed him to get on-the-job training. He's now paying student loans for a degree he'll likely never use. He says he hopes others will learn from his mistakes.

"Think about what position you are going to have to help you pay that back," said Halsey.

The U.S. Senate recently introduced a bill that would reduce tuition at in-state universities by 5 percent. There's also new income-based programs to help students pay back those student loans.

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