Given their higher debt levels, African American students would have more difficulty than others repaying their loans even if their post-college earnings were similar. But African American (and Hispanic) adults between the ages of 25 and 34 have lower earnings than white and Asian adults with the same level of educational attainment-further exacerbating an already uphill climb to student loan repayment. For example www.worldpaydayloans.com/payday-loans-ny/ithaca/, median earnings for bachelor’s degree recipients in 2016 were $41,529 for African American young adults, $41,664 for Hispanics, and $47,478 for white adults in this age range (Table 8).
In addition to having lower earnings than their peers, African American borrowers in repayment on their student loans are less likely than others to have assistance from parents or others in repaying their loans. Among students who began college in 200304, the range of borrowers saying after they left school that they had help repaying their loans was from 10 percent among African American borrowers to 20 percent among Asian borrowers (Table 9).
Repayment
The release of new data from the U.S. Department of Education has recently focused attention on the repayment patterns of African American borrowers. Given their debt levels and limited access to resources before, during, and after college, it is not surprising that they struggle more with student debt. But the findings are, nonetheless, startling. The data reveal that 12 years after they first enrolled in 200304, about half of African American borrowers had defaulted on at least one federal loan and more than half of the borrowers in this group owed more than they originally borrowed. This was not the case for other borrowers-including Hispanic borrowers (Miller 2017).
Controlling for family background eliminates about half of the difference in default rates between Black and white borrowers. But even accounting for differences in degree attainment, college GPA, and post-college income and employment cannot fully explain the Black-white difference in default rates (Scott-Clayton 2018). Solving this problem and alleviating the challenges facing these students is critical to achieving the nation’s goals for a successful postsecondary system.
The median amount owed by this group 12 years after starting college was 114 percent of the amount borrowed, compared with 47 percent for white graduates, 79 percent for Hispanic graduates, and 80 percent for those from low-income households, as measured by having received a federal Pell Grant (Scott-Clayton 2018).
Conclusion
Student debt is more of a burden for African American students than for others. The financial resources available to them before, during, and after college are very limited. They are more likely than others to have attended elementary and secondary schools that did not prepare them well for college-level work and they come disproportionately from families without college experience. Other underrepresented groups, such as Hispanic students, face some but not all of the same barriers.
These circumstances, combined with the institutions in which they enroll and the timing of their postsecondary education, likely all contribute to the fact that African American students tend to accrue more debt than those from other racial and ethnic groups-including other underrepresented minority groups-earning similar degrees. The barriers that African American students face in repaying their loans are at least partially the result of the difficulty they have completing their studies, their own post-college earnings, and the limited resources of their families of origin. Further research should improve our under- standing of how all the circumstances facing African American students contribute to their unique struggles with student debt. Improved understanding of these distinct factors and how they interact should make it possible for educators and policymakers to better target solutions that can reverse these trends.