The Project on Student Debt recently published its figures for the Class of 2009—and it ain’t pretty.

American student debt is frighteningly high; according to the study, which was published by the Institute for College Access and Success, the national average debt for a graduating senior in 2009 was $24,000. Among all states, D.C. claims the highest debt rate per student ($30,033), although New Hampshire ($29,443), Maine ($29,143), Iowa ($28,883), and Vermont ($27,786) followed close behind.

Surprisingly enough, however, Georgetown doesn’t have the highest student debt among all schools in the nation’s capital. Corcoran College of Art and Design ($42,355) leads the pack, followed by American University ($40,966) and George Washington University ($31,299). The figures make Georgetown’s $25,085 average debt look paltry by comparison.

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We’re not finished with college rankings yet? Guh.

Last week, Forbes reported that Georgetown has the second-most expensive dorms in the country. And what do students get for a measly $12,750?

“[A room] in one of four brick high-rises that resemble the aging, cramped spaces parents may remember from their own college days.”

During the 2010-2011 academic year [PDF], residence costs will range from $8,014 to $9,646. (Meal plans will cost $1,226 to $4,468.) The charges mark a 10 percent rise in room and board charges over the past three years.

But look on the bright side—Forbes ranked Georgetown as the 52nd best college in the country! Hurray for subjectivism!

Photo by Flickr user “neubie” used under a Creative Commons license.

Graduates from colleges in the District of Columbia have the highest level of debt in the nation, according to a report released Tuesday by The Project on Student Debt. Students in the District’s class of 2008 averaged $29,793 in debt, placing them ahead of students in Iowa, Connecticut, New York, and New Hampshire, some of the states with the highest levels of debt in the country.

The District was represented in the survey by data collected from three area private institutions: Georgetown University, George Washington University, and American University. At the same time, a (relatively) small proportion of D.C. students—49 percent—reported having debt, making them 40th in the country in this statistic.

Although Georgetown and George Washington appear annually on lists of the most expensive schools in the country, American University students reported having both the region’s highest average debt ($34,213) and the highest proportion of students with debt (56 percent). Debt for Georgetown University and George Washington graduates averaged $23,333 and $30,817 respectively.

Adding to the financial hardship for recent graduates, unemployment among college graduates rose to 10.6 percent in the 3rd quarter of 2008, the highest percentage on record.

The Georgetown Law Center recently announced that it will be starting a loan forgiveness program for graduates who go into the public sector.  Now any Georgetown Law alum who does 10 years of work in the public sector in a legal capacity and earns less than $75,000 a year will not have to repay their law school loans.

According to the Law Center’s press release, loan repayments for those working for U.S.-based government or nonprofit organizations will be reimbursed by Georgetown Law, and the remaining principal balance will be forgiven by the federal government.

The money to cover the reimbursement will come out-of-pocket from the Law Center.  For public service employees who earn more than $75,000 the Law Center’s benefits would continue on a diminishing basis.

The Department of Education just released statistics about how many students defaulted on their loans during fiscal year 2007, and the results are rather depressing: the national default rate rose to 6.7 percent, up from the previous year’s 5.2 percent.  That means 225,300 defaulted, out of the 3.3 million people whose first student loan repayment was due between October 1, 2006 and September 30, 2007.

Although the situation nationwide isn’t encouraging, Georgetown students certainly have something to cheer about: our default rate remained at the mindbogglingly low .2 percent.  Only six of the 2,075 Georgetown alums whose loans entered repayment during FY 2007 ended up defaulting.

Our default rate isn’t just a fraction of the national average, it’s also significantly lower than the average for four-year private universities, 3.6 percent.  Private schools overall had a default rate of 3.7 percent—significantly lower than the rate for public schools (5.9 percent) and for-profit schools (11 percent).

Georgetown’s default rate was also lower than that for Washington D.C. as a whole (4.3 percent).  George Washington University’s default rate was 1.2 percent and American University’s was 1.8 percent.

Cartoon by Adam Zyglis.

Today the House of Representatives took a step towards modernizing the federal student aid system by passing the Student Aid and Fiscal Responsibility Act.  The act will eliminate the government subsidies and guarantees that private lenders get for issuing student loans and will make the federal government the direct lender for student loans.

Estimates are that the government will save $87 billion over ten years by eliminating the subsidies.  That money will be used to make sure that interest rates on student loans remain low and expanding the Pell Grant program.  The bill also contains promises to streamline the Free Application for Federal Student Aid  and expand access to Perkins Loans.

The bill was sponsored by George Miller (D—Calif.) and was passed 253-171 (247 of the votes in favor of the bill were from Democrats and 167 of the votes against it were from Republicans).

This weekend the Washington Times ran a lengthy feature about the myriad of problems college students are facing in the rough economy (hey, I wonder why no one else has thought of running that…).

The article is pretty broad, hitting on everything from excessive student loan debt and poor employment prospects to skyrocketing tuition costs and the pressure students feel to avoid low-paying careers in the nonprofit and public service sectors.

What sets the Washington Times‘ woe-is-the-college-student piece apart from the rest, though? The fact that it features none other than Nick Troiano (COL ’11), GUSA rabble-rouser extraordinaire!

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Only for the fortunate few, now more than ever

The recession has led to a lot of hardship and disappointment all around. This year’s crop of high school seniors deciding where to go to college are in a particular bind, having to reconcile their academic dreams with economic realities.

The Associated Press has an especially heartstrings-tugging story out today about the issue. The article is largely focused on Laura Mueller-Soppart, a Chicago senior who had her heart set on the School of Foreign Service (which was “sparkling with erudite conversations about international affairs” and employs her personal heroine, Madeline Albright):

She got accepted, but when the financial aid award letters arrived, her family’s expected contribution was way beyond what they felt they could afford, given how the drop in the stock market had cut their savings by more than half. She also had two younger brothers to think about.

So when Northeastern University in Boston offered her a nearly full ride, she asked herself: “Do I go $200,000 in the hole because so many told me Georgetown was indispensable, or do I take the full ride?”

She is taking the full ride.

“It was really hard for me, hard to the point where I cried all the time because I felt it was so incredibly unfair,” Mueller-Soppart said. “I told myself I could have worked half as hard as I did and ended up in the same place.”

The article goes on to explain that because Georgetown uses federal financial aid forms to assess a family’s expected contribution, Mueller-Soppart’s family was at a disadvantage because they hadn’t invested their savings in retirement funds (which can’t be counted for determining a family’s financial contribution). She still hopes to come to Georgetown for grad school, though.

Here’s what University Spokesperson Julie Green Bataille had to say about the story:

[W]e know that students and families are making difficult decisions about college this year and that’s why we’ve taken the steps we have in terms of limiting tuition growth and increasing our financial aid budget.

Photo from Flickr user ehpien, used under a Creative Commons license.

Free Money!!!

President Obama’s proposed overhaul of the student-loan industry has ruffled more than a few corporate feathers and elicited the dreaded “S” word from people not named Rush Limbaugh (though I’m sure Rush would oblige if you offered him some Vicodin), so it’s high-time we provided a curt rundown of what the President is talking about. The BS-free version of Obama’s student loan reform program:

Under the current system, students choose among three different types of loans: federal direct loans made by the government, federally guaranteed loans made by banks and other private lenders, and non-guaranteed loans from private lenders. The government currently subsidizes federally guaranteed loans given by private lenders such as Sallie Mae, the largest student lender in the nation, while guaranteeing the amount loaned—effectively cushioning the lender from virtually all risk associated with lending while allowing private lenders to reap a healthy chunk of change in the process.

In short, it’s a pretty sweet deal for lenders that get a piece of the pie (read: Sallie Mae), but abuses and inefficiencies in the student-loan industry have caused many to doubt the efficacy of the current system.

After the jump, what the Prez. is proposing…

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In an overwhelming 356 to 71 vote yesterday, the House approved a bill to slash interest rates on federal student loans, a measure that could save students over $2,000 by the end of their loan. But don’t celebrate just yet. The bill won’t go into full effect until 2011, when it will expire unless renewed by Congress. The pricey legislation will also pose a challenge for the Democrats’ pay-as-you-go pledge.

Senator Edward Kennedy plans to consider the measure as a part of broader legislation to handle rising higher education costs. However, the Senate has not yet voted on the bill and President Bush vocally opposes it. The White House released a statement Tuesday warning that the bill would increase student borrowing: “encouraging more student debt can also fuel today’s upward tuition spiral.” Can’t fight that logic.

According to Democratic estimates, the plan could nearly double the $2,300 in savings for borrowers if the cut becomes perminant. Time, however, will tell.