The Crushing Weight of Student Loan Debt

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Americans are burdened by student loan debt than ever before.  They are more than $1.53 trillion dollars in debt. That money is owed by young people fresh out of college, and by borrowers who have been out of school for a decade or more. The most recent figures show that among the Class of 2018, 69% of college students took out student loans, and they graduated with an average debt of $29,800, including both private and federal debt. 

Higher education has long been considered the ticket to affluence and job satisfaction. The earnings for degree holders has grown steadily over the past several decades.  But, the value of a college degree has never been higher – at least in financial terms.  Over the past decade, the cost of a university education has risen three times faster than other school-related expenses. Most students finance some of that cost by taking out student loans, with the goal of having their investment pay off with higher earnings after graduation. 

The standard repayment timetable for federal loans is 10 years, but research suggests it actually takes four-year degree holders an average of 19.7 years to pay off their loans.

Top statistics of the student loan debt landscape in 2019:

Current U.S. Student Loan Debt = est. $1.53 Trillion

1 in 4 Americans have student loan debt: An est. 44.7 Million people

Average student loan debt amount = $37,172

Average student loan payment = $393/month 

Most Americans try hard to meet their student loan obligations, but a greater number of borrowers are falling behind on their payments.

Student loans now have the highest rates of delinquency. At the third quarter of 2018, 11.5% of student loans were more than 90 days past due. In contrast, the credit card delinquency rate stood at 7.9% and the auto loan delinquency rate at 4.3%. Home equity line of credit (HE revolving) and mortgage delinquency rates were even lower, at 1.2% and 1.1%, respectively.

The challenges of repaying student loans may be, in part, because of high interest rates. As more graduates discover private refinancing options, which can lower monthly payments significantly, delinquency rates may fall.

The overwhelming majority of outstanding student loan debt is owed to the federal government. The remaining 19% is owed to private banks.

You can watch more on student loan debt this Sunday on Raising the Bar, hosts Jason Clark, President of the Metropolitan Black Bar Association and Attorney Adeola Adejobi are joined by Nicole L. Arrindell, Associate General Counsel, and Nicole R. Perry, Deputy Commissioner of New York City Department of Consumer and Worker Protection to discuss the student loan debt crisis.

Airs on Sunday, May 26th at 7:30pm ET on MNN1, MNN HD, or livestream on mnn.org