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By Aliss Higham
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Student loan delinquency has climbed to roughly 25 percent of borrowers with payments due during the first year of the current Trump administration, according to new analysis.
Researchers from The Century Foundation and Protect Borrowers said the sharp rise in missed payments, nearly triple the pre-coronavirus pandemic rate, has pushed millions into default risk and lowered credit scores, warning of broader financial fallout for households and colleges facing higher nonpayment rates.
Why It Matters
More than 42 million Americans hold student loan debts, according to the Education Data Initiative.
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The analysis estimated nearly 9 million borrowers, about one in five, are in default, exposing them to potential wage garnishment and tax refund offsets, though some federal collection tools have been paused.
Being in default on a student loan generally means you have failed to make payments for an extended period and the loan is considered seriously delinquent. For most federal student loans issued by the U.S. Department of Education, a borrower enters default after 270 days, about nine months, of nonpayment.
What To Know
The delinquency rate for borrowers with payments due reached about 25 percent, nearly three times the 2019 rate, after the end of the pandemic-era protections and subsequent policy changes during 2025.
Researchers reported 7.9 million borrowers entered delinquency in the first three quarters of 2025, with 6.3 million still delinquent by the end of the third quarter, and an average student loan balance of about $34,000 among those delinquent.
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The report said the Education Department removed the income-driven repayment application for three months in early 2025, later restoring it, and mass‑denied 328,000 IDR applications as a backlog of applications swelled to 734,000 by year end.
The report comes as the Education Department reminds colleges and universities that they have a responsibility to "support borrowers throughout their federal student loan repayment journey." It told colleges that high nonpayment rates could foreshadow higher default rates and warned institutions with persistent high cohort default rates could lose access to federal aid programs.
What People Are Saying
Jennifer Zhang, a policy, research, and data analyst at Protect Borrowers and co-author of the study said: "Our analysis shows that working families with student debt cannot keep up with the Trump administration's efforts to push them to the financial brink. This administration spent the last year depriving borrowers of access to affordable repayment plans, while gutting the very agencies that help borrowers and hold servicers accountable. As a result, delinquencies hit a record high and a new borrower falls into default every 9 seconds. This is code red for working families, the affordability crisis, and the broader economy."
Nicholas Kent, Under Secretary of Education said regarding colleges supporting students in repaying their loans: "With nonpayment rates rising at hundreds of colleges and universities across the country, institutions must do more to support successful loan repayment outcomes. Student borrowers have an obligation to repay their loans, but institutions also share a responsibility to ensure their students are prepared to enter repayment and understand the consequences of nonpayment. Institutions cannot benefit from taxpayer dollars while ignoring the fact that a significant share of their students are not well-prepared to repay their loans. It’s time for institutions to step up or risk losing access to federal student aid."
What Happens Next
Beginning July 1, 2026, the repayment system will shift as the Repayment Assistance Plan and a modified standard plan take effect for new and many existing borrowers, while current borrowers seeking to remain on an income‑driven plan will need to move to Income‑Based Repayment by 2028 to avoid automatic placement into RAP.
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