Why New Student Loan Borrowers Are Doing Better At Keeping Up With Payments Than Older Borrowers

As younger borrowers become more aware of repayment options that suit their situation, they seem to be keeping up with their payments better than older borrowers.

A survey conducted in July 2024 and published this week by Pew Research, a nonpartisan think tank, found that 92% of new student loan borrowers were making on-time payments. New borrowers, as categorized by Pew Research, had either not yet taken out student loans, were still in school, or were still in the six-month grace period after graduating from college at the start of the COVID-19 pandemic.

Comparatively, the survey found that only 77% of all student loan borrowers were making on-time payments.

New Borrowers Are More Aware of Their Repayment Options

These numbers suggest new borrowers, who make up about a quarter of all student loan borrowers, are doing better at keeping up with their payments than older borrowers. That is mainly thanks to an increase in communication from the Department of Education, said Ama Takyi-Laryea, a senior manager at Pew Research.

“[New borrowers] are entering a repayment system where it has been on pause, and then when restarting it, there has been more of a conscious push from the administration and previous administrations to reach out,” Takyi-Laryea said. “The communication has definitely improved, as opposed to previously.”

This awareness has allowed many new borrowers, 70% of whom said they experienced a financial hardship, to enroll in repayment plans that best suit their situations. In some cases, payments on income-driven repayment plans can be as low as $0, which a third of the new borrowers surveyed reported they had.

“They knew about repayment options… which meant that they were more likely to have affordable repayment options, including $0 monthly payments,” Takyi-Laryea said. “That awareness, I think, translated into them being more educated [about making] payments and more successful.”

More Borrowers Are Behind, and Delinquent Borrowers Are Getting Older

According to a recent report from the Federal Reserve Bank of New York, the average age of a delinquent increased to 40.4 in the first quarter of 2025 from 38.6 in the first quarter of 2020. This means fewer younger borrowers are falling behind on their payments compared to older borrowers.

Additionally, in a recent report from TransUnion, a consumer credit reporting agency, about a third of student loan borrowers were 90 days or more past due on their payments as of April.

That is more than 10 percentage points higher than in February, when student loan servicers resumed reporting to credit agencies. It is also almost 20 percentage points higher than February 2020, before the government paused all payments during the pandemic.