More than one-in-three borrowers who have defaulted on their student loans did so without ever attempting to make a payment, according to a new report.
A record 11 percent of the 44 million former college students with
outstanding loan debt now sit in default—far beyond the 8.6 percent peak in mortgage defaults at the height of the housing crisis that caused the Great Recession—according to the Student Loan Report. Nearly half of all those in default, 48.6 percent, said in a survey that they never obtained a college degree, while 33.8 percent have not made a single payment on their debt.
The majority of those in default have more than one student loan
outstanding with 11.2 percent saying they have four or more debt
payments to make.
The majority of respondents said they entered default because of their inability to find a good-paying job (30.85 percent), lost their job
(22.62), or lived in communities with high living expense (28.52
percent). Just 39 percent of the defaulters said they had full-time jobs.
"The most common problems stem from either not working or getting laid off. Furthermore, a large group said their living expenses were too high, leading them to miss student loan payments. These all point to income problems—whether it's too low or non-existent," the report says.
Student loan debt is now largely backed by the federal government and carries unique terms compared to traditional credit card or mortgage loans. It cannot, for example, be discharged in bankruptcy courts.
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And never had any intentions of paying that loan back. I paid all my student loans off.
ReplyDeleteShould we act like we're surprised and not expected to cover the loss?
ReplyDeleteWhat do you expect when former presidents make proposals to give them a free ride
ReplyDeleteNot everyone should go to college. Then they wouldn't have these huge loans to pay off.
ReplyDeleteAt least 35% of students in college in this country have no business being there.
ReplyDeleteCollege is a choice and not for everyone. There is too much emphasis and pressure to go to college. Some folks like to work with their hands or build things. There is absolutely nothing wrong with that. But unfortunately so many kids who aren't prepared for college take out loans and then find out college isn't for them and then are stuck with massive debt to pay back. Shame on the student loan companies for charging such high interest. So much greed in America. That certainly does not give them the right to default on the loans however.
ReplyDeleteSpoiled brats should have to pay for the consequences of borrowing for what you want rather than what you need. They borrowed it.
ReplyDelete