College Debt in U.S. Surpasses Credit Card Debt
College Debt in the US
A Ticking Time Bomb
In the United States, students have now amassed more than one trillion dollars in student loans. That is more then all the consumer credit card debt in the US.
According to the National Association of Consumer Bankruptcy Attorneys, college seniors who graduated with student loans in 2010 owed an average of $25,250. That’s up five percent from the previous year. Parents had an average of $34,000 in student loans for their children. That figure is up 75% from 2005.
Students and their parents are borrowing at record rates and it’s putting families in a deep hole. This is setting people up to become economically non-functional for the rest of their adult lives.
With current law, it is nearly impossible to get rid of student loan debt through bankruptcy. And there is no statute of limitations on student loans. That means lenders and creditors can keep after you all of your life. A bill was recently introduced in Congress, called the ‘Private student loan bankruptcy fairness act’. It would treat private student loan debt the same as other consumer debt. If it passes, students and parents in financial trouble would be able to seek bankruptcy protection.
Student loan debt is still nowhere near outstanding mortgage debt in the U.S., which stands at about $13.5 billion.