NAICU Washington Update

Updated Student Aid Information Released

October 29, 2021

This week, new student aid quarterly data was released by the Office of Federal Student (FSA) covering the third quarter of 2021. While this data includes the standard information on the overall outstanding student loan debt, student loan debt delinquencies, and income-driven enrollment, it also includes new student loan servicer performance metrics and allocations that took effect on September 1, 2021. 

Below are highlights of key findings from the reports included in the update. 

Outstanding Loan Portfolio Overview

As of June 30, 2021, the outstanding federal student loan portfolio is $1.59 trillion, representing 42.8 million unduplicated student aid recipients. 

Shift in Loan Statuses

Due to the pandemic, the number of recipients in repayment status has fallen significantly. Less than 500,000 Direct Loan (DL) recipients were in repayment status as of June 30, 2021, compared to 18.1 million recipients in March 2020. Only one percent of all outstanding DL dollar balances are currently in repayment status, around 24 million DL recipients with outstanding loans of about $967 billion are now in forbearance status, and over 99% of those balances are in the CARES Act forbearance. When including Department of Education-held Federal Family Education Loan (FFEL) recipients, approximately 25 million recipients with more than $1 trillion in outstanding loan balances are now in forbearance.

Department-Held Delinquencies and Direct Loan Defaults

With almost all federal student loan borrowers now in forbearance, no DL borrowers entered default during this period. 

Income-Driven Repayment (IDR) Enrollment

Enrollment in IDR plans has increased slightly during the pandemic. As of June 2021, 8.3 million DL recipients were enrolled in IDR plans, up 1% from June 2020. Adding Department-held FFEL recipients, 8.6 million unique recipients are enrolled in IDR plans. That is 30% of all Department-serviced recipients.

Free Application for Federal Student Aid (FAFSA) Volume and Aid Disbursements

FAFSA applications have been declining since award year 2011–12, except for a modest increase in award year 2017–18 when the application cycle was extended from 18 to 21 months. Applications for the 2021–22 award year so far are down about 2% from this time last year.

Borrower Defense to Repayment

$1.1 billion has been discharged through borrower defense to repayment compared to $575 million in March 2021.

Public Service Loan Forgiveness

22,000 borrowers will receive forgiveness without further action on their part due to an earlier announcement by FSA. 

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