Student loan debt a bigger hurdle for borrowers in Pennsylvania to overcome, studies say
Two recent studies show that Pennsylvania ranks among the states with the highest student debt per borrower, although one of those studies included a ranking of higher education institutions showing that California University of Pennsylvania leaves borrowers with a comparatively low amount of debt for the average borrower.
The numbers show that student loan debt continues to be a major burden for college graduates in Pennsylvania.
Wesley Norris, 22, graduated in May from California University of Pennsylvania after taking out student loans which covered the majority of his tuition. He snagged an operations support systems developer job at Armstrong Cable in Butler and hopes to pay off his student loan debt within two to three years but can see it taking longer than that.
Norris is grateful that he got a job two months ago and was able to move in with his sister in Sarver, both moves that will help him erase his debt. He knows that others have had to wait longer in job-hunting limbo even as the reality of student loan payback becomes real.
“It takes a while to soak in, how much money you’re actually borrowing,” Norris said, estimating that he has roughly $30,000 to pay off. ” … I don’t think a lot of people realize it at first, how much student loan debt they’re going to end up with.”
If they got their higher education in Pennsylvania, they might be paying a little extra.
A recent WalletHub study found that Pennsylvania has the second-highest average student debt for college graduates nationwide at $35,759. LendEDU, a marketplace for student loan refinancing and private student loans, recently released a study finding that Pennsylvania had the highest average debt per borrower in the country at $36,193, up $1,008 from last year, with 67 percent of graduates being saddled with debt.
“Staying current on your payments is very important, and if possible, making more than the minimum payment on your highest interest rate can help reduce your student debt,” advised WalletHub analyst Jill Gonzalez. “For those who are really struggling with student loans, consolidating or refinancing might be a good idea.”
Per the most recent U.S. Department of Education data, more than five million borrowers entered repayment of a federal student loan between Oct. 1, 2013, and Sept. 30, 2016, with 11.5 percent of them defaulting on their loans.
Fiscal year 2014’s cohort default rates included 7.3 percent for California University of Pennsylvania borrowers, 2.8 percent for Waynesburg University borrowers, 9.5 percent for Fayette County Career & Technical Institute borrowers and 9.3 percent for Laurel Business Institute borrowers, meaning those percentages of borrowers defaulted or met a specified condition.
According to rankings by LendEDU published in August, California University of Pennsylvania placed among the top 200 public colleges with the lowest debt per borrower in the nation (171st).
“I think the most important thing worth noting is that all graduates should think long and hard before deciding where to put their college degree to work,” Gonzalez said. “Location is very important, because even though some states have higher average salaries, they usually also come with higher costs of living.”
Gonzalez noted that there is a connection between student loan debt and the economy as a whole.
“The purpose of getting a college degree, and implicitly a student loan, is qualifying for better, higher-paid jobs,” Gonzalez said. “This would in turn help graduates pay their debt and contribute to an overall growth of the economy.”
Norris recommended that students sit down with their parents to discuss financial aid options well before their debt builds.
“I think a big thing is a lot of people don’t really feel it until after you graduate,” Norris said.