October 2, 2000: The Clinton-Gore Administration: Cutting Student Loan Defaults and Opening the Doors of College for All Americans

October 2, 2000

"This is the lowest default rate in the history of the student loan program, and it has been achieved while tripling the number of loans given every year. By cutting defaults, increasing collections, and making the system more competitive, we have saved taxpayers and students a total of $27 billion. That is very good news for the American people."

Today, at the White House, President Clinton announced that the national student loan default rate is 6.9%—the lowest rate ever, and one-third the 22.4% rate that existed when he took office. Lower default rates and better loan collections have saved taxpayers more than $14 billion since 1993, and other student loan reforms have saved taxpayers $4 billion and students $9 billion, for a total of $27 billion in savings since the start of this Administration. The President called on Congress to enact his College Opportunity Tax Cut; expand the GEAR UP program for at-risk youth; and invest in America's education priorities such as school construction and modernization, smaller class sizes, more highly qualified teachers and after-school learning opportunities, and accountability for failing schools.

ANNOUNCING THE LOWEST STUDENT LOAN DEFAULT RATE EVER. President Clinton inherited a student loan default rate of 22.4% – the highest ever. Under this Administration, the rate has declined for 8 consecutive years, and is now at 6.9% – the lowest rate ever. In addition, collections on defaulted loans have quadrupled, from $1 billion in 1993 to $4 billion last year. The decrease in student loan defaults can be credited to:

BUILDING ON EIGHT YEARS OF STUDENT LOAN REFORM. Today's announcement builds on 8 years of efforts to reform the student loan program and create more opportunities for college. Under the Clinton-Gore Administration, students have saved $9 billion: $5 billion through lower interest rates and $4 billion through lower fees. Taxpayers have saved $18 billion: $7 billion by preventing defaults, $7 billion by improved default collections, and $4 billion by making loans through the cheaper Direct Student Loan program. The record includes:

CALLING ON CONGRESS TO INVEST IN AMERICA'S EDUCATION PRIORITIES. The President urged Congress to pass a fiscally responsible budget that invests in key education initiatives. The current Republican budget provides:

October 2000

October 25, 2000: Working to Achieve Common Ground on Middle-Class Tax Relief

October 24, 2000: The Clinton-Gore Administration: Working to Modernize America's Schools

October 23, 2000: Helping To Make Our Roads Safer

October 17, 2000: The Clinton-Gore Administration: Urging Congress to Support America's Education Priorities

October 11, 2000: Historic Protection for America's Environment and Cultural Heritage

October 2, 2000: The Clinton-Gore Administration: Cutting Student Loan Defaults and Opening the Doors of College for All Americans

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