Cohort Default Rates

Definition of the three-year rate:

As defined with 34 CFR 668.202(a)(2), a Cohort Default Rate (CDR) is the percentage of Stafford Loan borrowers who default before the end of the second federal fiscal year following the federal fiscal year in which they entered repayment on their loans.

The U.S. Department of Education (USDE) calculates CDRs annually for each participant in the federal student loan programs, including both postsecondary schools and FFELP guarantors. The most recent year for which final CDRs have been published is 2011 for two-year rates and 2010 for three-year rates.

For help with understanding the eCDR process, the USDE offers a Cohort Default Rate guide, frequently asked questions, and other helpful information. You may also call the Default Prevention and Management Hotline at (202) 377-4259 or send an email to [email protected].

CDRs in Missouri
There are benefits to monitoring your institution's CDR. Whether your institution has a high or low rate, you have an accountability to address the reasons why loan defaults occur within the borrower population at your institution. The MDHE has resources and services to help you do just that. For free, customized training regarding calculating, monitoring, and managing your school's default rates, you may request training from the MDHE's default prevention staff.

The MDHE has offered a range of financial literacy and default prevention services for more than a decade, which has helped Missouri's CDRs stay as low as possible.

  • National 2-year CDR for 2011 - 10 percent
  • Missouri's 2-year CDR for 2011 - 8.9 percent
  • National 3-year CDR for 2010 - 14.7 percent
  • Missouri's 3-year CDR for 2010 - 13.1 percent

2012 will most likely be the last two-year cohort default rate postsecondary institutions and the state of Missouri receive. In February 2014, the U.S. Department of Education will release draft three-year CDRs for 2011, with official rates being released in September. After receiving their draft rate, institutions will have 45 days to review the loan record detail report, identify any errors in the calculation data, and submit challenges to correct the errors. Once the official rates are released in September, institutions should verify all accepted challenges are reflected in the official rate and that there are no errors.

Per 34 CFR 668.217, if a school’s official three-year CDR is equal to or greater than 30 percent when the official CDR is published in September, then a school will be required to establish a Default Prevention Task Force, develop a default prevention plan and submit it to the USDE.