Frequency of student loan defaults on the rise
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A new report from the U.S. Department of Education shows rising default rates on federal student loans both nationally and here in Minnesota.
Across the country 8.8 percent of students who started paying back student loans in 2009 defaulted. That's up from 7 percent over the year before.
The rate is lower among students in Minnesota, but it's also on the rise, having increased to 5.8 percent from 3.7 percent in 2008, according to Tricia Grimes, a policy analyst at the Minnesota Office of Higher Education.
"Nationally it also increased and everyone assumes it's because students are struggling to find work in this economy," Grimes said.
Those who have trouble paying back student loans can file deferments based on unemployment or economic hardship, Grimes said.
"We wish that more students knew about the fact that there is an unemployment deferment they can get on repaying their loans," Grimes said.
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