(CNSNews.com) – Four years after the federal government took over the student loan program, nine percent of student loans are in default and another 23 percent have the potential to go bad as well, according to a report by the Treasury Borrowing Advisory Committee (TBAC).
“Millions of student-loan borrowers are in default on their student loans; many more could face default in the near future,” Deputy Treasury Secretary Sarah Bloom Raskin said during a Tampa speech on Nov. 6th, two days after the report was released.
According to data released Nov. 7 by the Federal Reserve, Americans currently owe $1.3 trillion on their student loans. The level of education indebtedness has increased 84 percent since 2009.
”Since the passing of the Student Aid and Fiscal Responsibility Act of 2010 (SAFRA), all federal student loans are made directly by the Department of Education and funded by the U.S. Treasury,” the TBAC report explained. “For a variety of reasons, loan growth is increasing and default rates are high and rising.”
And the current nine percent default rate, which exceeded auto loan delinquencies for the first time ever, is likely the tip of the iceberg.
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Mine have almost tripled and the payments have not made a dent. The system that allowed this monster to grow is never going to contain it. I know when you borrow money it is paid back with interest, the additional fines and fees that are added have made the hope of ever having it paid in full impossible but I will continue to pay what I am told to.
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