WASHINGTON, March 17 (UPI) -- The U.S. Department of Education said a growing number of borrowers have enrolled in income-based student loan repayment plans and fewer borrowers are facing delinquencies and defaults.
The DOE, in its Quarterly Student Aid Report, said the percentage of borrowers who defaulted in the first quarter of fiscal year 2016 is down to 2.3 percent from 2.5 percent in the first quarter of fiscal year 2015.
"While we see promising signs of progress, we know we have work to do to ensure that every borrower in distress has a clear path to avoid default," U.S. Secretary of Education John B. King Jr., said. "And I will continue to fight to ensure that students have access to an affordable education that helps them get ahead, rather than drowning in debt."
Among the highlights of the report:
-- Enrollment in income-based repayment programs, including Pay As You Earn, Revised Pay As You Earn, Income-Based Repayment and Income-Contingent Repayment, are on the rise. In December 2015, nearly 4.6 million Direct Loan borrowers were enrolled in a repayment program, a 48 percent increase over the same period in 2014 and a 140 percent increase over 2013.
-- Unemployment and economic hardship deferments for Direct Loan recipients are down 31.5 percent as of December 2015 over the same period in 2014. At the same time, forbearances on Direct and Federal Family Education Loan programs are down slightly, possibly due to the income-driven repayment options, the Education Department said.
-- Private collection agencies have collected more than $2.2 billion in defaulted student loans through December 2015. A large sum of the collected money was due to rehabilitations, which allows defaulted borrowers to get back into positive financial standing.