Statistics Show the US Racial Wealth Gap Affects Minority Graduation and Student Loan Default Rates

May 11, 2018 | | Card Rates |

Accumulating student loan debt has become a typical part of higher education for students. As of March 2018, nearly 44 million Americans owed over $1.48 trillion in student loan debt, a number expected to grow as tuition rates outpace inflation and wage growth. Few people experience the hardships of student loan debt more than students of color. Approximately 77.7% of all black students use federal student loans to pay for their education. That group also has the highest loan default rates and lowest graduation rates among college students. Research from public policy organization Demos shows that nearly half of black students default on their student loans within 12 years of starting college. [...]

Mark Huelsman, a Senior Policy Analyst at public policy organization Demos has spent years studying economic and racial inequality in the educational system. He recently spoke with us on the topic of racial inequality in student loan processing and college enrollment.

“Students of color used to make up a very small percentage of the college-going population,” he said. “In 1980, students of color made up 1 out of every 6 college students. Now they make up close to half. The shift to using student debt as the primary mechanism for financing college happened as more low-income students were coming to college.” [...]