Federal Student Aid (FSA) has released the FY 2023 Official National Student Loan Cohort Default Rate (CDR), which increased to 0.4%, up from 0.0% for FY 2022.
The FY 2023 rate includes borrowers who entered repayment between October 1, 2022, and September 30, 2023, and who defaulted by September 30, 2025.
While the national rate remains historically low, FSA cautions institutions against viewing the 0.4% rate as an indication of current borrower repayment performance. The FY 2023 CDR was significantly affected by the federal student loan payment pause, during which borrowers with Department of Education-held loans were not required to make payments and did not enter default.
FY 2023 CDR at a Glance
Across 5,417 institutions, approximately 3.37 million borrowers entered repayment and 14,296 borrowers defaulted, resulting in the 0.4% national rate.
By institutional sector, the official FY 2023 CDRs were:
- Public institutions: 0.3%
- Private institutions: 0.3%
- Proprietary institutions: 0.8%
- Foreign institutions: 0.2%
For comparison, the national CDR was 2.3% for FY 2019 and 0.0% for FY 2020, FY 2021, and FY 2022, illustrating the significant impact of pandemic-era repayment flexibilities on recent CDR calculations.
FSA Points Institutions to Nonrepayment Rates
Because the FY 2023 CDR does not fully reflect current repayment conditions, FSA continues to encourage institutions to review their nonrepayment rate. This measure identifies the percentage of an institution’s Direct Loan borrowers who entered repayment between January 2020 and May 2025 and whose loans were more than 90 days delinquent.
According to data updated in September, approximately 1,800 institutions have nonrepayment rates of 25% or higher. FSA is strongly encouraging institutions above that threshold to prepare for the upcoming draft FY 2024 CDRs, expected in February 2027.
Looking Ahead to FY 2024
The FY 2024 CDR will be particularly important because it will be the first cohort rate calculated entirely after the federal student loan payment pause ended. As a result, it should provide institutions with a clearer picture of borrower repayment outcomes following the return to repayment.
FSA recommends that institutions, particularly those with elevated nonrepayment rates:
- Review and maintain their default management and prevention plans and target outreach to delinquent borrowers.
- Participate in FSA’s “Default Prevention: Institutional Strategies for Success” webinar on October 13, 2026, from 1:15 to 2:15 p.m. ET.
- Use FSA’s new self-paced CDR and default prevention learning track, which includes courses covering CDR fundamentals and practical default prevention and management strategies.
- Review available CDR information and resources through FSA’s Default Management Center.
FSA is encouraging institutions to understand CDR requirements and the potential consequences associated with elevated default rates before the FY 2024 CDR cycle begins.
Although the FY 2023 national CDR remains low, institutions should not assume that the rate reflects current repayment conditions. Nonrepayment data may provide a more immediate indication of borrower repayment challenges and an opportunity for institutions to strengthen outreach and default prevention efforts before the FY 2024 CDRs are released.
SOURCE: (LOANS-26-08) FY 2023 Official National Student Loan Cohort Default Rate Briefing