According to experts, the outlook is not pretty for student loan borrowers. While a college education is virtually necessary to secure a good job in Florida, the cost of that education may feel like it is rising out of control. With predictions of defaults on the rise, borrowers may want to begin considering their debt relief options.
By 2023, 40 percent of student loan borrowers in the United States are predicted to default on their student loans. Currently, 44 million people owe a collective $1.5 trillion, and that number is only growing. The 2016 graduating class left school with an average of $37,000 in student loans, and 2017 graduates are burdened with an average of $40,000. Next year’s 2019 graduates may have an even greater burden on their shoulders.
However, the problems for student loan borrowers are not all in the future. Currently, 250,000 people who took out federal student loans default on them every quarter, and the problem is not isolated to those with massive amounts of debt. Borrowers with relatively small student loans default at higher rates than their peers who owe more. Of those who owe less than $5,000, 32 percent default at least one time within four years of taking out the loan.
Some Florida borrowers find success in student loan consolidation or refinancing. Others choose to make an extra payment or two if they expect to face financial troubles in the future, which may grant them a small reprieve when those troubles hit. However, for those who are truly struggling, these approaches may not be enough.
Student loans cannot be discharged through bankruptcy, but that does not mean that the debt relief provided through this process is useless. Many consumers who struggle with student loan repayment are also dealing with other debts that bankruptcy can readily discharge. When these debts are discharged, most people can refocus their attention to successfully paying off their loans.