9 Apr 2015

National student loan debt reaches a bonkers $1.2 trillion

Kyle Craig wants to go to graduate school, but just being an undergraduate is already drowning him in debt.
“I’ve got student loans just like everyone else walking around,” says Craig, a senior at Old Dominion University. “I expect my debt to be around $30,000 by the time I’m done here.”
“Yes, I have student loans,” says Kyle Coghill, a junior at Old Dominion. “I’m a 22-year-old studying communications at a university. Of course I have them. I have absolutely no clue how long I’ll be paying them off. I don’t really want to think about that.”
Craig and Coghill are just two of the 40 million people across the United States who have monumental student debt, as reported by CNN. In fact, student loans have increased by 84% since the recession (from 2008 to 2014) and are the only type of consumer debt not decreasing, according to a study from Experian, which analyzed student loan trends from 2008 through 2014.
The analysis also finds that in total, a staggering $1.2 trillion is bleeding students dry.
Of all of the open student loan accounts, says Experian, 39% ($417 billion) are in deferment (the period during which payments are not obligatory) and 61% ($727 billion) are in repayment. Of the consumers who are currently in the repayment stage, their average payment is $279 per consumer.
But here’s some good news from the Experian study: Among adults 18 to 34 years of age, the average credit score of those who had at least one open student loan account was 640, 20 points higher than others in their age group. Student loans do, in fact, have the potential — if paid in a timely a manner — to help younger people establish a decent credit history before they go on to buy things like homes and cars.

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