The student loan crisis continues to be a national conversation—especially as it continues to grow, now reaching a cumulative $1.53 trillion student loan debt in total–and the government may be at the losing end of most of those loans. The borrower base also shows no sign of slowing down, at 44 million currently, and with larger numbers of rising students taking out loans as college tuition becomes more and more expensive. And while there are obviously students of all ages attending colleges and universities around the US, many in the younger generations are struggling as they exit school with student loan payments over $350.
Recent news confirms that it is the millennial crowd feeling the pain most, with the government not planning to give in anytime soon regarding more lax forgiveness programs:
“We would like people to repay their debts,” Director of the Office of Management and Budget Mick Mulvaney said. “We think that’s a fair thing to do.”
Mulvaney does point to the need for better pre-loan counseling, a topic we cover frequently, as many young borrowers may not have any experience in money management or a realistic understanding of what it really takes to make a substantial payment each month.
“It’s like, look, if you’re going to borrow this money make sure you’re using it to get an education that can get you a job that helps you pay it back,” he said.
Along with concerns about delinquencies and defaults also comes the question of the economy overall as so many borrowers have their spending restricted due to student loans. This means far too many are forced to put large purchases on hold, to include homes and cars—and they may not be able to open businesses either, due to their finances. Analysts are concerned that this could begin affecting the economy overall as millennials not buying homes means that contractors are out of work, subcontractors suffer, the real estate industry suffers—all eventually leading to an economic breakdown.
Defaults can have severe repercussions for borrowers of any age, affecting not only their credit, but their ability to take out other student loans ever again. Private servicers may sue upon default, hoping to gain default judgments, while the federal government may garnish wages, intercept tax refunds, and far more.
Speak with an attorney from Fitzgerald & Campbell, APLC as soon as possible to examine your options. Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include student loan issues, bankruptcy, and other debt management processes. We are here to help! Click here to schedule a free 30-minute consultation, call us at (844) 431-3851, or email us at firstname.lastname@example.org.