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Gan Golan, dressed as the 'Master of Degrees,' holds a ball and chain representing his student debt during Occupy DC activities in Washington. (Photo: Jacquelyn Martin/AP)
Student Loan Delinquencies Skyrocket Signaling 'Latest Red Flag'
'This situation is simply unsustainable and we’re already suffering the consequences'
Jan 30, 2013
Young people are more likely than ever to default on their students loans, according to a new report published Tuesday by the Fair Isaac Corp. (FICO Labs), signaling that the monstrous debt situation is worsening and will continue to plague our next generation of graduates.
"This situation is simply unsustainable and we're already suffering the consequences," said Andrew Jennings, head of FICO Labs. "When wage growth is slow and jobs are not as plentiful as they once were, it is impossible for individuals to continue taking out ever-larger student loans without greatly increasing the risk of default. There is no way around that harsh reality."
Calling the report the "latest red flag" the LA Times reports, "the student-loan delinquency rate in the last three years has risen to 15.1%, up from 12.4% from 2005 to 2007 [...] That's a nearly 22% increase."
At the same time, the average loan balances also continue to skyrocket indicating that school costs are growing even more out of reach for the average student. According to the report, "in 2005, the average U.S. student loan debt was $17,233. By 2012, it had ballooned to more than $27,253 - an increase of 58 percent in seven years."
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Lauren McCauley
Lauren McCauley is a former senior editor for Common Dreams covering national and international politics and progressive news. She is now the Editor of Maine Morning Star. Lauren also helped produce a number of documentary films, including the award-winning Soundtrack for a Revolution and The Hollywood Complex, as well as one currently in production about civil rights icon James Meredith. Her writing has been featured on Newsweek, BillMoyers.com, TruthDig, Truthout, In These Times, and Extra! the newsletter of Fairness and Accuracy in Reporting. She currently lives in Kennebunk, Maine with her husband, two children, a dog, and several chickens.
Young people are more likely than ever to default on their students loans, according to a new report published Tuesday by the Fair Isaac Corp. (FICO Labs), signaling that the monstrous debt situation is worsening and will continue to plague our next generation of graduates.
"This situation is simply unsustainable and we're already suffering the consequences," said Andrew Jennings, head of FICO Labs. "When wage growth is slow and jobs are not as plentiful as they once were, it is impossible for individuals to continue taking out ever-larger student loans without greatly increasing the risk of default. There is no way around that harsh reality."
Calling the report the "latest red flag" the LA Times reports, "the student-loan delinquency rate in the last three years has risen to 15.1%, up from 12.4% from 2005 to 2007 [...] That's a nearly 22% increase."
At the same time, the average loan balances also continue to skyrocket indicating that school costs are growing even more out of reach for the average student. According to the report, "in 2005, the average U.S. student loan debt was $17,233. By 2012, it had ballooned to more than $27,253 - an increase of 58 percent in seven years."
Lauren McCauley
Lauren McCauley is a former senior editor for Common Dreams covering national and international politics and progressive news. She is now the Editor of Maine Morning Star. Lauren also helped produce a number of documentary films, including the award-winning Soundtrack for a Revolution and The Hollywood Complex, as well as one currently in production about civil rights icon James Meredith. Her writing has been featured on Newsweek, BillMoyers.com, TruthDig, Truthout, In These Times, and Extra! the newsletter of Fairness and Accuracy in Reporting. She currently lives in Kennebunk, Maine with her husband, two children, a dog, and several chickens.
Young people are more likely than ever to default on their students loans, according to a new report published Tuesday by the Fair Isaac Corp. (FICO Labs), signaling that the monstrous debt situation is worsening and will continue to plague our next generation of graduates.
"This situation is simply unsustainable and we're already suffering the consequences," said Andrew Jennings, head of FICO Labs. "When wage growth is slow and jobs are not as plentiful as they once were, it is impossible for individuals to continue taking out ever-larger student loans without greatly increasing the risk of default. There is no way around that harsh reality."
Calling the report the "latest red flag" the LA Times reports, "the student-loan delinquency rate in the last three years has risen to 15.1%, up from 12.4% from 2005 to 2007 [...] That's a nearly 22% increase."
At the same time, the average loan balances also continue to skyrocket indicating that school costs are growing even more out of reach for the average student. According to the report, "in 2005, the average U.S. student loan debt was $17,233. By 2012, it had ballooned to more than $27,253 - an increase of 58 percent in seven years."
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