For the first time in history student loans have outstripped credit card debt and are poised to become a $1 trillion burden on American graduates.
According to USA Today students are securing loan amounts twice what they did a decade ago even as consumers reduce what they owe on credit cards and home loans.
And all that debt isn’t going away. The federally guaranteed loans have been granted Congressional protection way beyond general consumer debt and cannot be dismissed in bankruptcy.
The mountain of debt is destined to have a broad impact on the future of America’s economy.
“Students who borrow too much end up delaying life-cycle events such as buying a car, buying a home, getting married (and) having children,” Mark Kantrowitz, publisher of FinAid.org told USA Today.
The average undergraduate student borrowed $4,963 in 2010 and the highest default rate among borrowers was at for-profit schools serving lower-income students.
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