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It is exciting for a student to find ‘free money’ in his or her account. Student loans are the norm for parents and college students who wish to pursue higher education. Though a lot of college students and graduates are yet to clear the loans, there are facts about student loans that should be clear to them, parents, and other stakeholders.
Student debt has long closed the 1.5 trillion dollar mark. This figure has doubled in the last decade, owing to the increased cost of a college education. Most college graduates have depended on loans to complete their studies. However, it is considered a huge burden that each beneficially has to pay in order to acquire a decent secondary education. Here are facts about student loans that everyone should know.
1. The combined debt is 1.6 trillion dollars
The 1.5 trillion dollar mark was crossed in March of 2019. It is surprising to note that Americans owned half of the debt a decade ago. It means that the amount has doubled in just ten years. This can be attributed to several factors, most of them beyond the control of beneficiaries of these debts.
More Americans are now going to college compared to years before. They are dependent on loans to finance their schooling. Experts have also noted a sharp increase in the cost of education. It is estimated that students are paying 20 percent more for education today than ten years ago. This explains the sharp increase in the overall figure for student loans.
2. A Third Of All Outstanding Debt Is Owned By Just 6 Percent Of Borrowers
It appears that this segment or age group is carrying the heaviest burden for the loan. However, it would be expected, considering that it is the age immediately after leaving school. This means that most of them are beginning to work and are, therefore, yet to clear most of their dues.
Most college beneficiaries have no other source of income. Domyhomeworknow.com provides professional assistance with school assignments so that you can start your business or take a job and reduce dependence on these student loans. It is a huge burden to begin paying for the loan immediate into your first job after college.
3. The Debt Will Depend On State And College
A student will take a loan based on his or her cost of completing college. The cost depends on the course you are pursuing and the items in your college experience that need to be funded. Supplements from scholarships, family, and personal finances also reduce the loan taken. It explains the differences in college and states.
4. $34,000 Average Debt
An average student is expected to pay $34,000 in debt by the end of college. The figure may vary up or down based on the cost of pursuing a course and whether the student had other sources of finances. Still, this is a huge burden that the students have to carry.
5. Washington DC Students Borrow The Highest Loan
The average student studying in Washington DC leaves college with a loan of about $52,000. This figure is more than $15,000 above the national average. This can be attributed to the high cost of living in the state as well as prestigious courses and colleges in Washington DC. The lowest balances are seen in Dakota as well as Wyoming at $29,000.
6. The Average Student Is Paying 4 Loans
It is not always possible to get a singular lender to cover all your expenses. This explains why students graduate with up to 4 loans on average. Since it might be difficult to services these loans, most beneficiaries will defer payments on some loans to relieve pressure.
7. Defaulter Numbers Are Rising
The rate of student loan defaulting is at a high of 10.1 percent. Tough economic times and the high cost of living are blamed for the rise in default rates. Still, the funds are available to learners who wish to complete their college education.
A lot of students graduate without college loan debts. This is the ideal situation that every student or parent to endeavor to achieve. Luckily, there are numerous sources of funds that the students can use to fund their education successfully without relying on loans.