The U.S. Department of Education adjusted the cohort default rates of 11 institutions -- including one that was subsequently exempted from sanctions by the federal government -- in its latest annual report on borrowers who stopping making payments on student loans within three years of leaving school, a spokeswoman said.
The department announced Wednesday that three-year cohort default rates had dropped for the second year in a row to 11.3 percent for student borrowers who entered repayment in the 2013 fiscal year, citing measures such as income-driven repayment plans and new college affordability measures.
It had also made adjustments to cohort default rates for a handful of institutions in the previous two years by not holding colleges and universities accountable for defaulted loans that met certain criteria. A department spokeswoman said adjustments were made to take into account the impact of "split status" borrowers, who have multiple federal student loans that may not fall under the same repayment status.
This is the last year that institutions will have default rates adjusted to reflect split status borrowers, as they were instructed beginning with the 2011 fiscal year borrower cohort to begin resolving split status issues.
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