Tuesday, June 12, 2012

Five Startling Facts about Student Loans

...that Regressive Republicans and Corporate Democrats don't want you to know.

Look on your face when you hear about the 5 startling facts about student loans.

  1. Total Student debt in America has surpassed $1 Trillion, and is higher than credit card debt at $793 Billion.
  2. The amount of Student loan debt has gone up 275% in the last 10 years alone.
  3. In the last 20 years tuition and fees have doubled, yet median household income has risen only 2.1%.
  4. Bill collectors can legally garnish up to 25% of your wages if you default.
  5. It is the only form of debt that cannot be discharged in bankruptcy in normal circumstances.

Bottom Line

 

There is another factor that may explain this, for-profit colleges. While states and the federal government have been actively underfunding public universities and community colleges, for-profit schools have filled the gap. Close to one in four students who attends a for-profit school defaults on his or her federal student loans within 3 years of leaving school. This high rate of default combined with the fact that nearly all students at for-profit schools must borrow money to pay the cost of tuition, has resulted in a sector that enrolls approximately 10 percent of American higher education students but accounts for nearly 50 percent of all student loan defaults. Despite poor student outcomes, for-profit schools are highly profitable companies. Profits at 16 of the largest for-profit schools totaled $2.7 billion in 2009.


Sources:

Student Loans & Bankruptcy

Further reading:

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