For the second consecutive year, the federally guaranteed student loan program at Cal State Dominguez Hills has the highest default rate among California's public universities, according to the U.S. Department of Education.
High default rates also were recorded at Compton College, one of the community colleges considered a feeder school for Cal State Dominguez Hills. Compton's default rate in 1988, the last year that rates are available, climbed to a whopping 52.7% from 46.7% the previous year. That means more than half of the Compton students who were to begin repaying a loan in fiscal 1988 had failed to make payments in 1988 or 1989.
The default rate at Cal State Dominguez Hills is 19.7% for 1988, up from 16.8% in 1987.
About 140 of the loans--known as Stafford Loans--issued to Cal State Dominguez Hills students and totaling more than $708,000 are considered to be in default, according to the Education Department. There are 9,200 students at the university.
Officials at the Carson campus say the university's default rate is due in large part to the makeup of its student population: many of the borrowers are low-income, first-generation college students who sometimes do not complete their studies. Worsening economic conditions, campus officials say, also have contributed to the difficulty even successful students have in starting careers after school and repaying their loans.
Another factor, said James Hartman, dean of student enrollment services, is that state and federal grant money has not kept pace with increasing enrollment and the university has a limited pool of scholarship money. Consequently, students who would be better served by scholarships or federal grants must turn to the loan program.
Default rates are also up at El Camino College, another community college considered a feeder school for Cal State Dominguez Hills, but two others, Los Angeles Harbor and Los Angeles Southwest colleges, recorded declines.
In the last two years, both Congress and the Department of Education have approved rules that would penalize student aid programs at schools that do not maintain certain minimum default rates.
The department said in 1989 that a school whose default rate is greater than 60% could become ineligible or face other sanctions on all its federally backed financial aid programs; that rate will be lowered annually by 5% until it reaches 40%.
