Repayment rate depicts the fraction of borrowers at an institution who are not in default on their federal loans and who are making progress in paying them down (i.e. have paid down at least $1 in the initial balance on their loans) after entering repayment. The rates are available for 1, 3, 5, and 7 years after entering repayment.
1) The repayment rate methodology allocates consolidated balances to institutions based on the share of the balance that is attributed to each institution. This methodology considers principal balances as well as both accrued and capitalized interest for the underlying loan amounts at the time of consolidation. Please note that one borrower who attends multiple institutions can be included either in multiple cohorts at multiple institutions (if leaving different institutions in different fiscal years) or in the same cohort at multiple institutions (if leaving different institutions in the same fiscal year). As an example, in calculating the three-year repayment rate for a student borrowing at two institutions and leaving those institutions in two different fiscal years:
• For loans from the first institution, the total principal (which, by definition, includes any capitalized interest) and interest balance outstanding at the time of separating from the school forms the basis for comparison in the repayment rate assessment for that institution.
o Likewise, the total principal and interest balance outstanding when the loans from the second institution at the time separating from the school forms the basis for comparison in the repayment rate assessment for the second institution.
• If the student consolidates these loans together prior to the end of the third fiscal year following the date on which the student leaves the first institution, any balance on the new consolidation loan will be allocated between the first institution and the second institution proportionally to the total principal and interest balances just before consolidation.
• At the end of the third fiscal year for the first institution, that institution’s share of the consolidation loan’s principal and interest balance will be compared to the basis amount for that institution.
o At the end of the third fiscal year for the second institution (which may be a later year than for the first institution), the second institution’s share of the consolidation loan’s principal and interest balance will be compared to the basis amount for the second institution.
2) Past defaults have no bearing if they are back in repayment (or paid in full) at the time of measurement. Default status is considered only at the time of measurement (at the end of the 3rd, 5th and 7th fiscal years (FY) after leaving the institution), so if a loan was in default at some point in the 3-year window, but not in default at the end of the third FY, the three-year repayment rate calculation would be blind to the default. If a consolidated loan is in a default status at the end of a fiscal year, the student is not counted in the numerator (i.e. as having paid down at least $1 in principal balance) for any school that is linked to that loan and measured in that fiscal year—regardless of outstanding balance.
3) Only loans with in-school and military deferment codes at the time of measurement are excluded from the calculation. Loans in forbearance and other types of deferment are included in both the numerator and denominator of the calculation. In addition, loans discharged due to death or disability as of the time of measurement are also excluded from the repayment rate. If a student leaves school A, then borrows at school B (with in-school deferment for loans from schools A), and then leaves school B within the three-year window for school A, then all of the interest accrued for school A would be factored into the 3-year repayment rate for that school, regardless of the in-school deferment for school B.
4) All NSLDS default codes (DF, DU, etc.) except for two are treated as an unsuccessful repayment (i.e. the borrower is included in the denominator but not the numerator): Defaults that end in a discharge for either 1) bankruptcy or 2) disability are excluded from the calculation altogether. In addition, defaulted loans that are paid in full through consolidation are evaluated by the statuses of the resulting consolidation loans and the portion of the balances attributed to the institution for which data are calculated.