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Debt is below U.S. average

Amanda Larsh
Assistant News Editor

The average federal student loan debt at the University of La Verne for 2013 is about $22,000, said Diane Anchundia, director of financial aid.

According to CNN, the average U.S. student loan debt for 2012 is $29,400, up from $26,000 in 2011.

“Part of the reason why our student loan debt is so low is because our students would rather take on jobs or their parents would rather take on jobs rather than take out those student loans,” Anchundia said.

Tuition increases in public colleges and universities have led to an annual increase of $1,850, or 27 percent, since the 2007-08 school year. In California, the published tuition increase at four-year schools is up more than 70 percent, according to the Center on Budget and Policy Priorities.

“I think this (tuition increase) will probably force more students to accept the loans, the subsidized and unsubsidized loans, that they don’t want to,” Anchundia said.

“Here I got a good enough package, but I still had to take out one loan,” said Christian Rodriguez, a junior international studies major. “Considering this is a private school, the fact that I only owe $14,000 in debt is not bad.”

As students take out more loans to cover the increasing cost of tuition, they only add to the total federal debt, of which student debt contributes to 6 percent of the overall national debt.

Since the majority of student loans are backed by the U.S. government through private institutions or the Department of Education, tax payers are the ones who are hurt when students default, or fail to continue payments.

Combining student’s debt across the country quickly adds up as the Federal Reserve Bank of New York reported the total outstanding student loan debt in the U.S. to be $902 billion, while the Consumer Finance Protection Bureau puts the total closer to $1 trillion.

The average student who accepts loans will graduate $26,600 in debt. On top of that, one in ten graduates will have accumulated over $40,000 in debt, according to The Institute for College Access and Success’ Project on Student Debt.

“It’s pretty impressive on a lot of levels because we do have about 47 percent of students be eligible for PELL, which basically means that they are from a lower socio-economic bracket,” Anchundia said. “Some would say that’s an indicator that those students who would borrow would default, but in actuality that’s not the case with us.”

The University’s student default rate is currently 4.9 percent, down from 5 percent in 2009 as stated by information reported to the U.S. Department of Education.

But in regards to receiving financial aid, the average institutional financial aid award is about $16,000 per student, compared to the average financial aid pack that includes loans, which comes out to about $23,500 per student. Because of the loans available to students through the government, less than four percent of the student population takes out private loans.

“I feel like the University of La Verne does provide more aide, and as far as assistance to students because Cal State Northridge was too impacted with students,” said Rodriguez, who transferred from Northridge.

Although institutional scholarships may not increase as students move up, more loans are made available to the student.

“I have a decent scholarship, but it’s not something where I can afford to live on campus as well,” said Sesh Jayawardana, sophomore social science and music major.

“With tuition being increased it’s kind of out of reach. And I don’t want to get into more debt than I already am in because I’m a double major and I’m already going to be here for five years.”

“The federal student loans was a tool that was created by the government to aid students to obtain their education,” Anchundia said. “It’s about quality of life and it’s a small amount the student will be able to pay back when they graduate from the program.”

Amanda Larsh can be reached at amanda.larsh@laverne.edu.

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