Posted: Oct 22, 2013 9:08 PM by Lindsey Gordon (email@example.com)
Updated: Oct 23, 2013 12:57 PM
HELENA - According to the U.S. Department of Education, more students are borrowing money for college, they're borrowing more than ever and a startling number are struggling to pay them off. Montana students are no exception.
The Montana University System (MUS) is aiming to keep college affordable and suggests students consider potential salary and compare it to the debt they'll have once they've graduated, before choosing a major--a very different way than most students approach higher education, according to Ron Muffick, the director of student affairs.
According to the university system, about 64% of students take out loans for undergraduate degrees.
On average Montana students graduate with $25,000 in student loans for a bachelor's degree.
In the state, the default rate for student loans is at 8.2%, which represents students who went over a year without making a loan payment and are not in forbearance or deferment. The national average is at 10%.
Muffick said that they are doing what they can to shrink that number,"By implementing these programs: the financial literacy program, additional financial aid and default prevention. This three-pronged approach to affordability, I think is more cutting-edge. There is no other state in the country right now that is providing default prevention and services on these federal loans."
Montana hasn't always seen such a high default percentage. Muffick said that before 2010, loans were serviced locally instead of federally and Montana's default rate was one of the lowest in the nation, at 1.8%.
The Montana University System is offering this debt education services to all students. He said that there are many programs not being taking advantage of, like deferment for unemployment, or payments based on income.
To see the nation-wide study from the Department of Education, click here.