Simpson graduates face rising student loan debt

With December graduation quickly approaching and May graduation right around the corner, Simpson College seniors will soon be footing what will probably be the largest bill of their lives.

Nationally, the average college graduate leaves school with roughly $20,000 in education debt according to the State of Iowa Legislative Services Agency Fiscal Services and the Iowa College Student Aid Commission.

The state of Iowa’s average student loan debt is slightly higher than the national. For students graduating from private schools in Iowa, the average debt was $24,729 in 2006.

Iowa’s state average of student loan debt is the highest in the country. The average Simpson graduate in 2006 left with $27,238 in education debt.

Senior Kyle Yarkosky will graduate with nearly $70,000 in student loan debt, but isn’t worried about paying off his loans.

“I think eventually it will take awhile,” Yarkosky said. “It’s not like I’m going to make a ton of money right away. It will take time.”

Jessie Eilbert is a senior this year, and although she’s unsure of her amount of student loan debt, she has a plan for repaying her loans.

“I’m looking into a volunteer program that defers my loans,” Eilbert said. “I’m going to defer them for a year or two through Ameri Corps, hopefully. My plan is then to make monthly payments at an amount that I can afford.”

Eilbert hopes that deferring her repayment plan will make it easier to pay off her loans after she gets a job.

“I may be struggling a little bit at first, it depends on what I get into,” Eilbert said. “So, I’m not going to start out at a high salary, but I will make it work.”

Keith Bryan is a fifth-year student who received a grant to pay off his student loans. Without the grant, he would have faced a bill of nearly $15,000 in loans. Bryan says that without the grant, paying his student loans would have been difficult.

“I’d been saving up,” he said. “I wouldn’t have had too much left, but I probably would have had to do a payment plan.”

Before seniors graduate from Simpson, they undergo an exit loan counseling session to prepare them for their future.

The counseling session is provided to give students all the information they need about paying their loans back. Exit counseling is a federal requirement that informs students about loan repayment, consolidation, deferment, default, budgeting, and other useful information.

A student is also brought up to date about exactly how much they owe to their lenders and students are provided with the contact information and names of their lenders.

After graduation, students’ loans are automatically deferred for six months to give fresh college graduates a chance to get on their feet financially, find a job and be financially prepared to make the payments.

With the country’s poor economic state and many college graduates unable to find jobs right away, more and more are defaulting on student loans.

In September, the U. S. Education department reported that the 2007 “cohort default rate” – the number of federal loan borrowers starting repayment between October 2006 and September 2007 but defaulting on the loans one year later- jumped to 6.7 percent, up 1.5 percent from the year before.

The default rate of Simpson students as of 2007 was only 2.4 percent, well below the national average.

Tracie Pavon, assistant vice president for enrollment and financial assistance, commented on Simpson’s low default rate.

“Simpson students are doing a great job in fulfilling their obligations to repay their student loans,” Pavon said. “Of course, we do have students who cannot pay their loans back – every institution does. However, we have a very good default rate – meaning our students do pay back their student loans.”