Student loan delinquency rate jumps to nearly 25%: analysis
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Student loan default rates are on the rise, new research shows.
About 25% of student loan borrowers are now behind on payments, compared to about 9% in 2019 during President Donald Trump’s first term, according to a study. report It was published Friday by The Century Foundation, a left-leaning think tank.
Nearly 7.9 million student loan borrowers are in default in the first three quarters of 2025 alone, the study’s authors wrote. For its analysis, the foundation used data from the University of California Consumer Credit Panel, a nationally representative sample of 2% of U.S. adults with credit records.
Researchers said the Trump administration’s policies during its second term were responsible for the spike in crime.
“By blocking access to programs designed to help struggling borrowers, Donald Trump is trapping millions in a spiral of debt that destroys their credit scores and deprives them of homeownership, buying a car and other life milestones,” said Peter Granville, of The Century Foundation and lead author of the study.
Ellen Keast, press secretary for higher education at the Department of Education, said the Biden administration is masking default rates with relief measures for student loan borrowers.
“The idea of a sudden increase in student loan delinquencies is a misnomer,” Keast said. “The Trump Administration is once again reporting complete and accurate data on student loan repayment rather than expanding so-called pandemic-related flexibilities that ended five years ago.”
More than 42 million Americans have student loans and outstanding debt $1.6 trillionAccording to the Congressional Research Service.
Borrowers face repayment and loan challenges
Student loan borrowers are facing a barrage of recent changes to the loan system, including the end of the Biden administration’s Valuable Education Savings, or SAVINGS, plan. This plan was designed to be the most affordable repayment plan to date, but it faced legal challenges led by Republicans and was ultimately blocked in court.
For nearly five years, starting with the Covid pandemic, student loan borrowers who missed payments were also protected from collection activities and negative credit reporting. This relief has now expired.
The credit scores of nearly 2 million student loan borrowers with past-due loans dropped, with the average score dropping from 680 to 580, according to the foundation’s estimates. Credit scores, which affect people’s ability and costs to borrow money, typically range from 300 to 850; 670 and above is considered good.
The Ministry of Education announced last year that it would start collection activities against defaulted debtors, but this has repeatedly stalled enforcement efforts.
Higher education expert Mark Kantrowitz said the Trump administration’s cuts to the federal workforce are also likely exacerbating student loan borrowers’ repayment difficulties.
In March, Trump officials were fired Thousands of Department of Education employees, including many who assist borrowers. The administration also rolled back enforcement activities of the Consumer Financial Protection Bureau and sought to reduce the agency’s staff and funding, although many of these actions were challenged in court. The CFPB regulates student loan servicers and combats abusive practices in lending.
“When you get rid of the people who help debtors face financial difficulties, is it any surprise that these debtors face debt-related problems?” Kantrowitz said.
More than 600,000 federal student loan holders remain in a backlog of applications for an affordable repayment plan, the Education Department revealed in a recent court filing. More than 86,000 borrowers are awaiting the department’s decision on student loan forgiveness.
Which student loan borrowers are struggling
Student loan default rates are particularly high in some states in the South, according to analysis by the Century Foundation.
The analysis found that Louisiana and Mississippi account for nearly 40% of federal student loan borrowers with payments due, the largest shares nationwide.
Researchers found that black borrowers struggled the most.
While nearly 20% of white student loan borrowers are delinquent in the third quarter of 2025, more than 48% of Black student loan borrowers and nearly 30% of Hispanic borrowers are delinquent.
Why things could get worse for student loan borrowers
The average U.S. household has a family of four and an income of $81,000, monthly bill That figure rose from $36 to $440 due to regulatory changes, according to the Institute for College Access and Success, a nonprofit organization that promotes college affordability.
