Skip to main content
Accessibility  |  About  |  Contact  |  Privacy  |  Terms

Student Loan Debt - More Borrowers Becoming Delinquent

  • Published: 2012-04-08 : Nahrgang & Associates, P.C..
  • Synopsis: A bill before Congress would eliminate a provision that made private student loans non-dischargeable.

Main Document

More Borrowers Becoming Delinquent on Student Loan Debt - Many across the country are struggling to pay their student loans, and even defaulting on payments. Some lawmakers are attempting to make student loans dis-chargeable in bankruptcy to offer some relief.

Student loan debt is skyrocketing in the U.S. According to an analysis by the Federal Reserve Bank of New York, student borrowing exceeded $1 billion in 2011 alone, and total student debt for the country surpassed the $1 trillion mark. Student loans have replaced credit card debt as the number one source of debt for the nation. The total student loan debt in the U.S. has doubled in the past five years and students are borrowing at a rate double what they did ten years ago, adjusting for inflation, according to the College Board, a non-profit college member association. Many in Pennsylvania and across the country are struggling to pay their student loans, and even defaulting on payments. Some lawmakers are attempting to make student loans dischargeable in bankruptcy to offer young people overwhelmed with debt some relief.

Many People Defaulting

More people are defaulting on their student loans than ever before. Only 39 percent of borrowers were paying down their debts in the third quarter of 2011. Those still in school made up 29 percent of borrowers and another 18 percent of borrowers had economic hardship deferments on their loan payments. The remaining 14 percent of student loan borrowers - approximately 5.4 million borrowers holding about 10 percent of the country's student loan debt - were in default.

Reasons for Non-Payment

One of the main reasons that graduates are not paying their loans is the difficulties they are having finding jobs. The job market seems to be tightest for those just starting out. A Federal Reserve Bank of Cleveland analysis of unemployment statistics showed an unemployment rate for those 20 to 24 years old of 13 percent, compared to an overall unemployment rate of 8.3 percent.

Additionally, young workers have seen their wages shrink the most since the market downturn of 2008.

Making Student Loans Dischargeable

In light of the massive amount of student debt and the trouble people are having paying it back, some lawmakers have proposed legislation that would give those who took out private student loans the same right to discharge those loans in bankruptcy as they have to discharge other forms of debt.

Sponsors of the legislation have targeted private loans specifically since they are a potentially more hazardous financial proposition than federal student loans. Private loans do not have the same income-based repayment or economic hardship deferment options.

A bill before Congress would eliminate a provision in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 that made private student loans non-dischargeable.

Article provided by Nahrgang & Associates, P.C. - Visit us at

Similar Topics

1 : Inclusive Teaching Project Aims to Get Missing Million Into School : University of Sussex.
2 : Examining Feelings of Inclusion Among Students with Disabilities : New York University (NYU).
3 : Exclusion From School Can Trigger Long-Term Psychiatric Illness : University of Exeter.
4 : Evidence Supports Effectiveness of Mental Health Programs in Schools : Wolters Kluwer Health.
5 : Still Left Behind - Pathways to Inclusive Education for Girls with Disabilities : Leonard Cheshire Disability.
From our Education section - Full List (131 Items)

Submit disability news, coming events, as well as assistive technology product news and reviews.

Loan Information for low income singles, families, seniors and disabled. Includes home, vehicle and personal loans.

Famous People with Disabilities - Well known people with disabilities and conditions who contributed to society.

List of awareness ribbon colors and their meaning. Also see our calendar of awareness dates.

Blood Pressure Chart - What should your blood pressure be, and information on blood group types/compatibility.

1 : Newborns Who Experience Stroke Regain Language Function in Opposite Side of Brain
2 : Cognition and Emotion Play a Role in Predicting Quality of Children's Friendships
3 : Metabolomics - Promising Tool for Advancing in Treatment Personalization of Oncological Patients
4 : Climbing Stairs Lowers Blood Pressure and Strengthens Leg Muscles


Disclaimer: This site does not employ and is not overseen by medical professionals. Content on Disabled World is not intended to be a substitute for professional medical advice, diagnosis, or treatment. Always seek the advice of a physician or other qualified health provider with any questions you may have regarding a medical condition. See our Terms of Service for more information.

Reporting Errors: Disabled World is an independent website, your assistance in reporting outdated or inaccurate information is appreciated. If you find an error please let us know.