D.C. residents have the highest student debt in the country, according to a new study by the Federal Reserve Bank of New York, but the data also show D.C. residents paying off their loans quicker than the rest of the nation.
People in the District have on average of about $41,000 in student loan debt, while those in Maryland and Virginia have slightly less -- about $28,000 and $26,000, respectively. U.S. residents owe about $24,000 on average in student debt.
The study analyzed household debt and credit for the first quarter in 2013 and found that the South and the East Coast have the highest student debt per borrower.
|In the red|
|States with highest student debt per person:|
|1. D.C. - $41,230|
|2. Maryland - $28,330|
|3. Georgia - $27,660|
|4. New York - $27,310|
|5. Illinois - $26,440|
|States with lowest student debt per person:|
|1. Wyoming - $20,660|
|2. South Dakota - $21,120|
|3. North Dakota - $21,510|
|4. Utah - $22,140|
|5. Iowa - $22,180|
Despite having the highest student debt average, about 11 percent of residents with student loans
in the District are more than 90 days delinquent on payments.
Lauren Asher, president of the nonprofit Institute for College Access & Success, said the District and the surrounding area are both growing in jobs and people, so those figures are not surprising. The D.C. area has many college-educated residents who have racked up more loans but who pay them off faster because of secured employment.
She said studies show about two-thirds of the 2011 graduating class left school with debt. In areas where there are jobs with a plethora of people who have college degrees -- like D.C. -- the debt might not be as burdensome.
"Some [students] are getting jobs based on their education that would allow them to pay back their loans," she said. "The debt levels themselves don't tell you how burdensome that debt is. You are either in a situation where debt is hard to pay off or it's not."
Forbes recently ranked the District ninth on its list of best places for young professionals to live, because the area has relatively high salaries and low unemployment rates.
According to the U.S. Labor Department, unemployment rates have been steadily falling in the District, Maryland and Virginia. Its latest report shows unemployment in Virginia has dropped from 5.3 percent to 5.2 percent, in Maryland from 6.6 percent to 6.5 percent and in the District from 8.6 percent to 8.5 percent.
Economists predict while student loan rates will more than likely remain steady, they foresee delinquency rates falling over time. Wilbert van der Klaauw, senior vice president and economist at the New York Fed, said he believes the findings in the study show that the improving economy is speeding up the pace of debt reduction.