The rates at individual schools in the state, however, are all over the board, with one – Eastern New Mexico University – even recording a slight drop in its one-year default rate, according to the U.S. Department of Education.
As a whole, however, New Mexico has the dubious distinction of having the country’s highest college student loan default rate, a number that is climbing, while nationally the movement is in the opposite direction.
The DOE tracked loans over a three-year period, from 2011 to 2014, as well as the three-year periods that began in 2009 and 2010. The department posted the data on its website in late September.
New Mexico’s rate for the 2011-14 cohort was 20.8 percent, up from 16.4 percent a year earlier, a 25 percent increase. Nationally, the default rate was 13.7 percent, down a whole percentage point from a year earlier.
The second-highest default rate was claimed by Arizona, 18.4 percent, while Guam enjoyed the lowest rate, 3.8 percent.
The states with the lowest rates are North Dakota, at 6.1 percent, and Nebraska, 7.7 percent.
Of the five publicly funded state universities for which the DOE provided data, Western New Mexico University had the highest default rate, 28.3 percent, up nearly 10 points over 2010. The rates at the University of New Mexico, New Mexico State University and Highlands University also rose, but the increases were smaller. UNM’s rate was 13 percent, slightly lower than the national average but higher than the 8.6 percent recorded for the previous three-year period.
Terry Babbitt, associate vice president for enrollment management at UNM, said the university’s rate is “very similar to other public universities nationally.” However, one thing that differentiates UNM – and NMSU – is that the data includes their branch campuses. Like other public two-year colleges, the rate is a little higher, he said.
One reason for UNM’s low rate is the comparatively low cost of attendance and the lottery scholarship, which limit the amount a student may have to borrow, Babbitt said. He attributed the increase to “a lag in the economic environment.”
Of New Mexico universities, only ENMU saw a decline, from 21.1 percent in 2010 to 20.90 percent in 2011. However, the rate was still higher than the 18.1 percent recorded in 2009.
Brent Small, Eastern’s financial aid director, said that over the past three years, the Portales-based university has implemented diversion tactics and initiatives, with the help of a third, outside party, to reduce loan defaults and teach students the value of making timely payments on their loans.
ENMU will continue monitoring student borrowers, Small said. “We hope that the decline will become steady.”