Increasing Student Loan Debt
Increasing Student Loan Debt
Most recently, a report showed that there is an increase in terms of the debt load of both college students and college graduates.
Specifically, the report according to the Federal Reserve Bank of New York states that balances having overdue payments of a month or more reached up to 27 percent of the 37 million borrowers.
According to the same report, a result of an analysis of credit reports from Equifax, the balance of student loans that are not yet fully paid amounted to more or less $870 billion. This figure unexpectedly exceeded the overall credit card balance, which is $693 billion, and overall auto loan balance, which is $730 billion.
The outstanding student loan balance is estimated to maintain its increasing trend because of the increasing college enrollments and growing costs of attendance.
As stated in the report, the average outstanding student loan balance per borrower is $23,300.
Moreover, according to The Washington Post, one-third of the outstanding student loan is held by individuals between the age brackets of 30 years old to 39 years old. On the other hand, another one-third is held by Americans older than 39. This means that only a few of the college graduates fully pay their student loan while they are still in their 20s.
In addition, the report stated that compared to other types of household debt, for instance, credit cards and auto loans, the student loan debt is much more complicated. In particular, student loans include a lot more stakeholders, such as government, families and other relatives, banks, colleges and universities.
The report stated that student loan is not only a problem for the young but also parents and the federal government because a significant portion of the post-secondary education bill is carried by them.
Colleges and universities were urged by President Barrack Obama to reduce their costs. Also in fall of the previous year, 10 percent of the discretionary income was the limit of monthly loan payments.
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Filed under: bad credit • Credit • debt • Loans • loans for people with bad credit • Student Loans
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