Colleges With the Lowest Student Default Rates

As about 69% of students graduate college with debt, prospective students should consider earning a degree from a school with a history of graduating students with low student loan default rates. Get started with this path forward now.
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Colleges with the lowest student default rates often provide learners with alternative financial aid options, including scholarships, tuition assistance, and work-study programs. Students with fewer student loans face less risk for defaulting on their payments.

Read on to learn more about colleges with low student default rates and the effects of defaulting on a student loan. You can also learn about next steps if you do default on a student loan. is an advertising-supported site. Featured or trusted partner programs and all school search, finder, or match results are for schools that compensate us. This compensation does not influence our school rankings, resource guides, or other editorially-independent information published on this site.

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Our ranking methodology considers several factors, including what percentage of a school's student body receives aid, how much aid the average student receives, whether the school promises to meet 100% of demonstrated need, and what type of aid the school offers.

Top Colleges With the Lowest Student Default Rates

Lowest Student Loan Default Rates - Public Colleges

  1. The University of Chicago

    Chicago, Illinois

    Located in the Windy City, UChicago serves approximately 6,800 undergraduates and 10,000 graduate students. The university offers more than 50 majors and 40 minors for undergraduates.

    Six Nobel Prize winners currently teach at UChicago, among a faculty of almost 2,400 full-time professors. The university also features a worldwide alumni network of more than 180,000 individuals.

    • UChicago guarantees free tuition to students from families with incomes of less than $125,000 per year.
    • The university covers tuition, room, and board with financial aid for students from families with incomes of less than $60,000 per year.
    • UChicago's "No Barriers" policy helps students graduate debt-free by building individualized financial aid plans.
  2. Pomona College

    Claremont, California

    Based in Claremont, California, Pomona provides almost 50 majors and minors in the arts, social sciences, humanities, and natural sciences. The college serves over 1,600 students and maintains an average class size of 15 learners.

    Pomona funds internships for about 80 students each summer and offers paid experiential learning opportunities to about 130 students each academic year.

    • Pomona embraces a "need-blind" admissions process and is committed to meeting the demonstrated financial need of any student who enrolls at the school.
    • More than half of Pomona students receive financial aid, with an average award of about $52,000.
  3. Wesleyan University

    Middletown, Connecticut

    Located in Middletown, Connecticut, Wesleyan enrolls about 3,000 undergraduates and 200 graduate students. The university features a student-to-faculty ratio of 8-to-1. About 68% of incoming students ranked in the top 10% of their high school class.

    Wesleyan offers 45 different majors, 17 minors, and over 1,000 courses. The university also provides 12 different certificate programs.

    • About 50% of first-year students at Wesleyan receive scholarships and grants totaling an average of $55,000 per student.
    • Approximately 81% of first-year students receive a financial aid package of more than $25,000.
    • Families with an annual income of $30,000-$60,000 pay an average of $5,750 in net tuition costs.
  4. Carnegie Mellon University

    Pittsburgh, Pennsylvania

    Located in Pittsburgh, Pennsylvania, CMU enrolls more than 14,500 students and boasts over 109,000 alumni worldwide. CMU is one of 25 university members of the World Economic Forum's Global University Leaders Forum.

    The university offers 80 majors across six different academic colleges, including fine arts, information systems, and the sciences. About 14% of incoming students in the 2020 school year received a Pell Grant.

    • Approximately 76% of first-year applicants receive financial aid with tuition assistance.
    • CMU provides an average of $68,000 in aid to households with an income of less than $50,000.
    • The university offers scholarships, grants, and several types of work-study programs for students.
  5. Swarthmore College

    Swarthmore, Pennsylvania

    Approximately 33% of Swarthmore graduates go on to earn or pursue a doctoral degree. The college features an 8-to-1 student-to-faculty ratio and more than 600 courses and research opportunities for students.

    A liberal arts college, Swarthmore provides more than 40 areas of study in the fine arts and humanities, social sciences, natural sciences, and engineering. Swarthmore also offers an honors program, which includes small, seminar-style classes with oral and written exams administered by experts in the field.

    • Approximately 55% of students received need-based scholarships from Swarthmore in the 2019-2020 school year.
    • Swarthmore operates with a total financial aid budget of $46 million.
    • The college guarantees meeting 100% of demonstrated need with loan-free aid.
  6. Vassar College

    Poughkeepsie, New York

    Based in Poughkeepsie, New York, Vassar enrolls over 2,400 students. The college maintains an 8-to-1 student-to-faculty ratio, employing more than 350 faculty members.

    Students may choose from roughly 50 different majors across 30 departments. Students declare their major by the end of their sophomore year. Vassar also offers two accelerated, dual-degree programs in partnership with Columbia University (BA/MPH) and Dartmouth University (BA/BE).

    • Vassar guarantees to meet 100% of all demonstrated financial need for students for all four years of college.
    • More than 60% of students receive financial aid from Vassar.
    • In the 2020-2021 school year, Vassar awarded financial aid packages in amounts ranging from $3,500-$75,000.
  7. The University of Notre Dame

    Notre Dame, Indiana

    Based in Indiana, ND enrolls over 8,000 undergraduate students and almost 4,000 graduate students. The university offers 75 different majors across eight academic colleges.

    Eighty-seven percent of first-year students participated in community service in 2020. Additionally, 97% of recently graduated grad students found jobs that align with their career goals.

    • ND guarantees to meet 100% of every student's demonstrated financial need.
    • The university awarded an average of $47,800 in aid to first-year students in 2020.
    • Students with loans graduated from ND with an average debt of roughly $21,000 as of May 2020 — significantly below the national average.
  8. Hamilton College

    Clinton, New York

    Located in Clinton, New York, Hamilton College is the third-oldest college in the state. Hamilton enrolls over 1,800 students and offers fully need-blind admission.

    Around 81% of graduating seniors completed at least two internships while enrolled. The college offers almost 60 areas of study and maintains a 9-to-1 student-to-faculty ratio.

    • About 50% of students receive financial aid from Hamilton.
    • Students receive an average financial aid award of almost $52,000 through a combination of scholarships, student loans, and work-study programs.
    • Hamilton meets the full demonstrated financial need of every accepted student, drawing on a financial aid budget of almost $50 million and an endowment of over $1 billion.
  9. Washington and Lee University

    Lexington, Virginia

    Based in Lexington, Virginia, W&L enrolls over 1,800 students. The college is the ninth-oldest institution of higher education in the country. About 75% of students engage in community service while at W&L.

    W&L employs more than 200 faculty members and features a student-to-faculty ratio of 8-to-1. Undergraduate students may choose from 36 majors. About 15% of W&L students pursue a double major.

    • W&L promises to meet 100% of students' demonstrated financial need through scholarships, work-study programs, and grants.
    • More than half of incoming first-year students receive financial aid.
    • W&L awarded an average financial aid package of more than $50,000 to incoming first-year students in 2019-2020.
  10. Stanford University

    Stanford, California

    Located near Palo Alto, California, Stanford enrolls over 16,000 students and features a 5-to-1 student-to-teacher ratio. The university offers programs in business, energy and environmental science, medicine, and the humanities. Nineteen current Nobel laureates teach or remain involved with the university community.

    • In 2019, incoming first-year students received an average financial aid award of almost $60,000.
    • Ninety-nine percent of students with a total family income of less than $65,000 receive financial aid, with an average scholarship award of more than $78,000.
    • Stanford offers a minimum wage of more than $15 per hour for students looking to work part time on campus.

What Is a Default Rate?

"Default rate" refers to the rate of all loans that borrowers do not repay. Financial institutions declare loans in default if the borrower does not make any payments for an extended period of time. Lenders often transfer defaulted loans to a third-party debt collection agency to collect the money from the borrower.

A default rate, also known as a "penalty rate," can also refer to a very high interest rate that lenders apply when borrowers begin to make late payments or miss payments entirely. Lenders may lower the penalty rate if the borrower makes enough payments on time.

What Is the Default Rate for Student Loans?

Students who take out loans to pay for college must pay them back or face the penalties of defaulting. In 2019, Forbes listed the official default rate after three years for student loans at 10.1%. This rate marked a decrease from 2017, when the default rate for student loans was listed at 11.5%.

However, a Government Accountability Office report noted that graduates who enroll in forbearance — a strategy that temporarily relieves borrowers of their obligations to pay their loans back for a period of 4-5 years — likely did not count toward the official default rate if they defaulted on their loans after four or more years.

Which Types of Colleges Have High Student Default Rates?

For-profit colleges accounted for the highest student default rates, making up about a third of defaulting borrowers. A for-profit college has an individual or group of owners who earn a profit from tuition payments.

Public community colleges ranked as the next highest contributors, while public and private nonprofit four-year colleges saw the lowest student default rates. Nonprofit colleges receive leadership from a board of directors who must invest all money that the school makes back into the school.

What Happens If You Default on Your Student Loans?

Students who default on their loans may face the following consequences:

  • They lose eligibility for further federal financial aid.
  • The entire unpaid balance of the loan and any interest owed becomes due immediately.
  • Credit ratings go down, lowering a borrower's chances to get a credit card, buy a car, or buy a house.
  • Creditors take loan payments directly out of any wages earned.

Students who default on loans may experience consequences for years, particularly if their credit rating goes down. Creditors can also take students to court over defaulted loans, and academic institutions can withhold transcripts.

How Can I Fix My Student Loan Default?

Students or graduates who go into default can escape by starting to make payments again. Students who make enough on-time payments in a row can fix their default status and resume a regular payment schedule.

Loan servicers can help students in loan default figure out a payment plan. If a student defaults on a federal loan, the government assigns a loan servicer to the borrower at no cost.

Potential plans for students in default include income-driven payments and loan consolidation. However, you should always research all of your options before committing to a payment plan.

Find Additional Resources

Student Loan Refinance and Consolidation Guide

Private Student Loans Guide

The Debt-Free Degree

Explore Related Rankings is an advertising-supported site. Featured or trusted partner programs and all school search, finder, or match results are for schools that compensate us. This compensation does not influence our school rankings, resource guides, or other editorially-independent information published on this site.

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