The number of graduates who default on private student loans will continue to decline in 2014, according to a new report from Moody's. But the aftereffects of the financial crisis are likely to keep default rates above pre-recession levels for the foreseeable future.

Moody's private student loan default rate index declined to 3.4% in the fourth quarter of 2013, down nearly a percentage point from the same period a year ago. While defaults are likely to drop further throughout the next year, Moody's predicts that the index will remain above its pre-recession average of 2.5%.

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