Academic Preparedness

In general, the higher the high school class rank of a borrower, the less likely the borrower is to default. Texas A&M borrowers whose high school class rank was below the 25th percentile had a 12.8 percent default rate compared to a 3.2 percent default rate for borrowers at or above the 90th percentile. However, the relationship is fairly weak compared to other variables in the study (Steiner and Teszler 2003).
Borrowers with higher SAT Equivalency Scores (Equivalency Scores convert non-SAT scores to the SAT scale for students who took the ACT) have lower default rates. For borrowers with a combined verbal and math SAT score below 900 the default rate was 6.9 percent versus 4.4 percent for borrowers with a combined SAT of 901 to 1400. However, it should be noted that the vast majority of borrowers in the study had SAT scores above 900 (Steiner and Teszler 2003).
There is virtually no difference in the default rates of borrower who met the minimum high school coursework requirements for Texas (4 credits of English, 3.5 of math, 3 of science, and 2 of a foreign language) and those who did not meet them (Steiner and Teszler 2003).
In a study of borrowers at two-year schools, having a GED as opposed to a regular high school diploma was associated with a higher default rate (Christman 2000).

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