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The Characteristics Associated with Student - page 65 / 94

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65 / 94

1,120

90.8

114

9.2

1,234

1,638

94.6

94

5.4

1,732

1,184

95.6

55

4.4

1,239

1,353

96.6

47

3.4

1,400

1,679

96.4

63

3.6

1,742

1,595

95.5

76

4.5

1,671

1,720

95.3

84

4.7

1,804

1,881

96.6

66

3.4

1,947

6

85.7

1

14.3

7

12,176

95.3

600

4.7

12,776

Total TG Loan Guarantee Amount

Borrowers with small total amounts of TG loan guarantees ($3,000 or less) have a higher default rate (9.2 percent) than other borrowers. The small amounts of total guarantee dollars are probably related to short periods of attendance at Texas A&M that did not result in graduation. As the College Success variables indicated, short attendance periods and failure to graduate are associated with higher default rates. For ascending categories through $12,000 of total guarantee dollars, default rates steadily decline to 3.4 percent. After that point, however, the relationship between guarantee amount and default begins to break down. Though it appears that default rates increase for each rise in guarantee amount between $12,001 and $30,000, the differences in default rates for these categories are not statistically significant. The reason that default rates are so low for borrowers who received more than $30,000 in guaranteed loans is unclear at this point.

Borrowers who consolidate their loans have a higher default rate than borrowers who do not consolidate. Perhaps not surprisingly, these borrowers tend to have very high total indebtedness. In fact, loan consolidators account for about half of the borrowers who had a total TG loan indebtedness of $30,001 or more. But for borrowers who consolidate, indebtedness by itself is not the main factor; it appears that whether a not a consolidation borrower graduates is the determining factor. Consolidation borrowers who graduate have a 2.4 percent default rate. In contrast, consolidation borrowers who do not graduate have a 28.6 percent default rate and account for about 75 percent of all defaults among loan consolidators.

Total TG Loan Guarantee Amount

$1 to $3,000 $3,001 to $6,000 $6,001 to $9,000 $9,001 to $12,000 $12,001 to $16,000 $16,001 to $20,000 $20,001 to $30,000 30,001 or more Missing All Undergraduates

Consolidation

Total

% of

% of

row

N

row

N

No

Default

Yes

62

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