UW-Madison has lowest student loan default rate

UW–Madison students had the lowest Federal Perkins Loan default rate in 2001-02 of any school in the Big Ten for the third consecutive year, according to data compiled by Purdue University.

UW–Madison’s default rate for that academic year was 2.35 percent, which is one-third of a percentage point lower than any other Big Ten school.

The federal government provides funding for Perkins Loans, but payments are billed by the UW–Madison Bursar’s Office and collected by the Student Loan Servicing unit of the Office of Student Financial Services.

“This is a credit to UW–Madison’s ability to enroll excellent students and give then the training and preparation they need to find good employment after graduation,” Steve Van Ess, director of the Office of Student Financial Services, says. “It also shows that we are doing a good job of communicating with borrowers and explaining the importance of staying current on their loan repayments.”

Van Ess says a low default rate is important because it is a revolving loan fund, which means that repayments stay on campus to be loaned to other students. The federal government uses default rates to determine whether a school will be allowed to continue participating in federal financial aid programs.

Indiana University (2.63 percent) and Northwestern (2.89 percent) were just behind UW–Madison. Ohio St. University had the highest default rate in the Big Ten at 10.04 percent.