In Germany, riding the subway without buying a ticket is called schwarzfahren—quite literally “riding in the dark.” While it saves you money on the ticket, you’re always riding the train with a lingering fear that a fare inspector is going to discover you and slap you with a massive fine. Defaulting on your student loans is pretty much the millennial American version of schwarzfahren. You can’t ignore your student loans into going away (even declaring bankruptcy won’t get rid of them).
WASHINGTON — Virginians struggling with student loan debt have a new place to turn for help.
Scott Kemp is the state’s first student loan advocate.
He works within the Office of the Qualified Education Loan Ombudsman, which was established by The State Council of Higher Education for Virginia (SCHEV) at the direction of a law passed last year in the General Assembly.
Fall behind on your student loan payments, lose your job.
Few people realize that the loans they take out to pay for their education could eventually derail their careers. But in 19 states, government agencies can seize state-issued professional licenses from residents who default on their educational debts. Another state, South Dakota, suspends driver’s licenses, making it nearly impossible for people to get to work.
In 22 states, people who default on their student loans can have professional licenses suspended or revoked. The percentage of Americans who default on student loans has more than doubled since 2003.
Butch Dill/AP
Clementine Lindley says she had a great college experience, but if she had it to do over again, she probably wouldn't pick an expensive private school.
"I could actually buy a small home in Helena, Mont., with the amount of debt that I graduated with," she says.
Student-loan delinquencies surged last year, hitting consecutive records of $166.3 billion in the third quarter and $166.4 billion in the fourth.
Bloomberg calculated the dollar amounts from the Federal Reserve Bank of New York’s quarterly household-debt report, which includes only the total owed and the percentage delinquent at least 90 days or in default.
That percentage has remained around 11 percent since mid-2012, but the total increased to a record $1.46 trillion by December 2018, and unpaid student debt also rose to the highest ever.
Americans are diving deeper and deeper into the red.
As of this month, outstanding consumer debt exceeded $4 trillion for the first time, according to the Federal Reserve.
Relatively strong holiday spending, particularly in November, and increasing credit card debt added more than $41 billion in outstanding balances at the end of 2018, according to LendingTree, a loan comparison website, which analyzed the data from the Fed.
Parents are increasingly struggling to repay federal loans they’ve taken out to help cover their children’s college costs, according to newly released federal data.
The Parent Plus program allows parents to take out essentially uncapped amounts to cover college costs, regardless of the borrower’s income or ability to repay the loan. As the cost of college has risen, the program has become an increasingly critical workaround for families that max out on federal student loans and can’t pay the rest out of pocket.
It looks like things haven't improved much for student loan borrowers: 99.5% of people who applied for public service loan forgiveness have been rejected.
Here's what you need to know and what to do about it.
Student Loan Forgiveness: Debt Statistics
The U.S. Department of Education released the latest statistics for public service loan forgiveness:
As of September 30, 2018, 41,221 student loan borrowers submitted 49,669 applications for public service loan forgiveness.
Of that total, approximately 44,700 applications have been processed.
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"Nothing in life is to be feared. It is only to be understood."
– Marie Curie
The road to success is always under construction
– Lily Tomlin
"There is scarcely anything that drags a person down like debt."
– P. T. Barnum
"If we don't change direction soon, we'll end up where we're going."
– Irwin "Professor" Corey
“This would be a much better world if more married couples were as deeply in love as they are in debt.”
– Earl Wilson
“What I would like to do... once I take care of all my kids' student loans, is buy a red 1965 Mustang and fully restore it.”
– Mike Quigley
"Bankruptcy laws allow companies to smoothly reorganize, but not college graduates burdened by student loans."
