Deadbeat BAs: One in Five Student Loans is Delinquent
Help me understand why, again, everybody should go to college? There's a lot of student debt out there. From the Federal Reserve Bank of New York:
The outstanding student loan balance now stands at about $870 billion,1surpassing the total credit card balance ($693 billion) and the total auto loan balance ($730 billion). With college enrollments increasing and the costs of attendance rising, this balance is expected to continue its upward trend.
And, as usual, our president is unbothered:
In October 2011, President Obama announced executive actions to cap monthly federal student loan repayment at 10 percent of discretionary income for college graduates, eased from the previous 15 percent. This cap comes as some relief to those who worry about how they will pay back their debt. Moreover, student loan debts are typically shouldered by recent college graduates and other young workers, who tend to face lower incomes and higher rates of unemployment than older cohorts.
And that has resulted in this:
We find that 27 percent of the borrowers have past due balances, while the adjusted proportion of outstanding student loan balances that is delinquent is 21 percent...
Once again, Rick Santorum has a point.