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Tuesday, November 28, 2023

UW-Madison students rate tops in debt repayment

.More UW-Madison students are paying off their debts from a student aid program than any of the other 100 top colleges and universities that participate in the Perkins loan program, according to The Greentree Gazette, a higher education magazine. 




The Perkins loan, which provides low-interest government loans to students with financial need, is a revolving loan fund that uses money collected from former recipients to loan to future students. 




Cathie Hanlon, the UW-Madison bursar, said the low 1 percent default rate is especially important for a revolving loan because it allows students to continue to use the funds. 




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\The default rate measures the number of students who aren't paying back the loan,"" she said. ""So 99 percent of students are paying it back."" 




Hanlon said having the highest return rate for this loan is a sign of the success for not only the way the office runs the program but also shows students graduating from UW-Madison are finding jobs. 




""It's a really good statement about our students: They take paying back this loan seriously,"" she said. ""We try to emphasize keeping in touch ... There's a lot we can do to help students who are having trouble paying back the loan if we know about it. It also shows our students are graduating with a good education."" 




Jeff Pertl, legislative director of Associated Students of Madison said while grant money is the most helpful source of money for students with financial difficulty, loans such as the Perkins loan are a very cost-effective alternative. 




""Everybody likes grant money, but everybody knows it doesn't pay for everything,"" he said. ""It's very hard to secure a loan from a private bank. You have to have a co-signer and capital and they are very hard to get."" 




Pertl also said federal loans help many students keep the cost of school significantly lower than with private loans from banks. 




""Private loans compound while you are in college and while no one is happy about having a $17,000 loan, it's better than a $24,000 loan from a bank,"" he said. 




While default rates vary significantly from different schools based on location and student composition, Hanlon said some of UW-Madison's high ranking was due to how staff at the Bursar's office educated the loan's recipients on repayment. 




""The staff who work in our office take their work seriously,"" she said. ""They try to communicate up front about [the loan] and try not to just hand students legal documents, but they try to explain their rights and responsibilities in layman's terms."" 




Rounding out the top five universities with lowest default rates on the Perkins loan are the University of Puget Sound, 1.21 percent; Brown University, 1.71 percent; Northwestern University, 1.74 percent and Stanford University, 1.98 percent.

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