This is the first in a blog series on student loan debt in the United States. Check out the second blog article in this series, “What Constitutes ‘Too Much’ Student Loan Debt?”
Student loan debt has become a major problem in the United States, with far too many graduates struggling to pay back their loans long after finishing school. Moreover, a lot of college graduates have found that the debt they incurred in order to get their degree simply isn’t worth it. Part of the reason for this is that student loans debt tends to lead to more debt, as people don’t have the funds needed to cover their current expenses because they have to commit so many financial resources to paying back their expenses like student loans.
The student loan problem has gotten a great deal of media attention, and scrutiny, as financial experts take a closer look at the staggering numbers and point out that things are getting worse, not better. For example, student loan debt in this country is greater than credit card debt, which gives some indication of just how difficult it has become for college graduates to pay back their outstanding loans. In fact, student loan debt is now greater than auto loan debt, as well. Right now, student loan debt is second only to total mortgage debt.
Additionally, it has been noted that the default rates on student loans are at an all-time high of 12 percent. This makes sense given that many student loans now carry mandatory monthly payments of $800 per month.
Moreover, the student loan problem has gotten significantly worse in recent years. In 1993, less than half of all US college students had debt when they graduated. Now, more than 70 percent of students leave school with debt.
However, not all of the news about student loan debts is gloomy. For instance, a Goldman Sachs study from 2014 indicated that college grads with $30,000 or less in debt were just as likely as debt-free individuals to be able to afford a home purchase. Of course, this good news leaves out those graduates with more than $30K in debt – a number that is not all that difficult to reach considering just how expensive college tuition has become. (Statistics show that the average student loan debt for a recent college grad is $35,051.)
For more information, view the Yahoo.com article, “How Much Student Loan Debt Is Too Much? Here’s a Formula to Figure it Out.”
If you have fallen behind on student loan payments and are struggling with debt problems, you should talk to a qualified debt management attorney as soon as possible. The Posternock Apell, PC team, which assists clients in Cherry Hill, Moorestown, Maple Shade, Browns Mills and the rest of South Jersey, as well as the Philadelphia region. While student loans are infrequently dischargeable in bankruptcy filings, our legal team may be able to help you determine the best way to handle your student loan debt and avoid bankruptcy. Contact us today to schedule a free phone consultation.