Private college graduates end up with less student loan college debt because private colleges provide more financial aid, more students graduate in 4 years instead of 5 or 6 years and parents provide more financial help with tuition.
From TIME, "How a $54K-Per-Year School Is Deemed a 'Best Value College' " by Brad Tuttle:
Another interesting revelation from the Princeton Review roundup concerns average student debt upon graduation. Even when considering the discounted price, private schools cost double public universities, on average. And yet, public school grads tend to finish up their degrees with more debt.
Let’s look at a couple examples for the sake of comparison. Full tuition at Duke University is $44,000 [per year], and the average graduate gets out of school with $16,500 in debt. Down the road at rival UNC-Chapel Hill, tuition [per year] is $5,800 for in-state students and $26,500 for out-of-staters. The average debt for these public school grads is around $17,500. The difference is even starker in New Jersey. The full price of tuition, room and board, books, and fees at Princeton University is $52,480 [per year], compared to $26,217 in state or $36,369 out of state for students at the nearby College of New Jersey. Graduates of the latter come away with $32,754 debt, on average, compared to just $5,330 for the smarty pants Princeton kids.
Among all of the Princeton Review’s "Best Value Colleges," the median debt at private universities was slightly less than public schools: $20,556 vs. $21,373. How could this be? Robust aid at private schools factors in. Students at private universities are more likely to earn their degrees in four years too, which helps keep costs down. It’s also quite likely that private school students’ families provided significant help paying for college—which is probably one of the reasons why these students felt like they could attend in the first place.