Student debt grows to more than $25,000 for recent grads

Consumer Reports News: November 03, 2011 03:38 PM

The class of 2010's college graduates owed an average of $25,250 in student loans, up five percent from 2009, according to a new report from the Project on Student Debt.

College seniors who graduated with student loans last May also faced the highest unemployment levels—9.1 percent—in recent history for new college graduates, according to the report. In the report's survey data, 73 colleges reported that more than 90 percent of their class of 2010 graduated with debt. A total of 98 colleges reported that their graduates actually owed an average of more than $35,000.

The report focuses on graduates of public and private nonprofit four-year colleges who had federal or private student loans. The data came from more than 1,000 colleges, representing half of all public and private nonprofit four-year schools and three-quarters of the class of 2010.

"Student debt continues to rise, but debt levels vary tremendously from school to school and state to state," report author Matthew Reed said in a press statement.

The White House recently announced two initiatives to lower student loan payments for some borrowers. The first measure will update the existing income-based repayment program, capping loan payments at 10 percent (instead of 15 percent) of discretionary income for certain borrowers. The second measure will allow some borrowers to merge older student loans with newer ones.

Student Debt and the Class of 2010 [Project on Student Debt]

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