Tasha Younger has been one of the hidden statistics in the growing number of graduates and former students overburdened with education loans.
The 38-year-old mother of two — still trying to pay off her loans a decade after quitting nursing school — has been delinquent on her monthly payments but never in default.
Statistics typically show how many students simply fail to make payments. But a recent survey has found that for every person who defaults on student loans, at least two more are like Younger: late or short on payments.
In Younger's case, she was late for a few months and then was able to make interest-only payments for a while, which extended the term of the loans.
The study conducted by the nonprofit Institute of Higher Education Policy sheds light on a segment of the borrowing population that is usually ignored — and it is a large portion. Among all students borrowing to pay for their education, 1 in 4 is having trouble making full monthly payments, the study said.
"We talk endlessly about default rates and what that means for colleges, but not about delinquency," said Alisa Cunningham, coauthor of the report. "It's a really big problem, and I'm not sure that anybody really knew the extent of it."
Borrowers are delinquent when they are behind on payments, which can affect their ability to get a good rate on any future loan, including auto loans and mortgages, and will affect their credit reports.
For Younger, the problems started as soon as she left school. She couldn't find a job that paid enough to cover basic expenses plus the loan payments.
"It began to overwhelm me," Younger said. "Do I pay my electric bill or pay back my loans? I'm not able to make my payments because I need four new tires to drive my children around."
Being able to defer principle payments for a while kept her from defaulting. Now, as an administrative analyst for an insurance company, Younger has been able to catch up and continue making full payments.
The number of college graduates with debt increased from less than half in 1993 to two-thirds in 2008, according to the Education Department. And the average debt is going up sharply — to $23,200 in 2008 from $18,650 four years earlier.
If they don't catch up with payments, usually after nine months for federal loans, delinquent borrowers default. That makes them ineligible for new loans or grants, and the government can seize their tax refunds, garnish their wages, withhold public benefits such as Social Security or charge significant collection fees.
The study found that 26% of nearly 1.8 million borrowers surveyed had been delinquent on their loans but hadn't defaulted. In addition, 15% of borrowers had defaulted.
Cunningham said lack of knowledge might be a factor in why so many student loan borrowers experience delinquency at some point.
"I was surprised at the fact that a lot of these borrowers actually had never heard of things like forbearance or deference — especially since they're supposed to go through an educational process during college," Cunningham said, naming two methods for legally postponing payments.
Part of the task of educating borrowers falls to guaranty agencies. These are groups that once insured student loans, but now focus on education and advocacy. They also work to collect on and rehabilitate defaulted loans.
"Many borrowers end up becoming delinquent or defaulting because they don't know all of the options available to them," said Debra Chromy, vice president of government services at nonprofit guaranty agency American Student Assistance.
For example, she said, there are programs specifically for people who are unemployed and for teachers, as well as repayment programs that are based on the borrower's income level.
Chromy said educating borrowers works, according to a company study that showed that American Student Assistance was able to cut delinquency rates in half by informing borrowers of the options available to them.
But borrowers also have to be careful in choosing a guaranty agency, she said. Some for-profit agencies make more money if borrowers default than if borrowers are able to pay off loans over a longer period. That, she said, creates a disincentive for education and assistance.
For borrowers with questions about their student loans, Chromy suggested calling lenders, which are generally flexible and helpful in resolving issues, or visiting http://www.nslds.ed.gov, the website of the National Student Loan Data System, for information on loans, lenders and contacts for resolving outstanding debt.
After her experience, Younger has some practical recommendations: Borrowers should make sure they will be able to repay their loans before they accept them and should not to be afraid to ask for help.
"Don't let yourself get so behind that you're in a situation that your wages are going to be garnished or your tax [refunds] are going to be taken at a time when you need them," Younger said.
"Seek extra help if you need it, but do it in a timely fashion or you're really going to be hurting."