Tuesday, August 12, 2014

Half Of Federal Student Loan Borrowers Not Paying On Time

The Huffington Post reports:
Less than half of borrowers with the most common type of federal student loan are repaying their debt on time, new data released by the U.S. Department of Education show.

About 51 percent of Americans with student loans made directly by the Education Department, known as Direct Loans, have either fallen behind or are not making expected payments, according to data on the $686 billion portfolio. Borrowers who aren't making expected payments for reasons that include temporary financial hardship or a return to school are included in the tally. Not included are borrowers not expected to pay back their loans because they've either never left school, or are less than six months out of school. The figures are based on dollar amounts, rather than the number of borrowers.

Of the roughly $300 billion in Direct Loans in repayment, one in six, or about 17.2 percent, are at least 31 days delinquent, data show. By comparison, just 3.3 percent of all loans and leases held by U.S. banks are at least 30 days late, according to the Federal Reserve.
What better proof that the government has no business being involved in education?