Nearly half of student loan borrowers graduate school owing at least $20,000 – which is double the share of borrowers a decade ago – according to a new report from the Consumer Financial Protection Bureau (CFPB).
“The Bureau’s research shows that people are taking on more student debt later in life, and having a tougher time paying it back,” CFPB Director Richard Cordray said.
According to the latest student loan debt statistics from personal finance site Make Lemonade, there are over 44 million student loan borrowers in the U.S. who collectively owe more than $1.4 trillion in student loans. The average student in the Class of 2016 has $37,172 in student loan debt.
Here's what you need to know and what you can do to help manage your student loans.
Borrowers Are Borrowing More Student Loan Debt
The CFPB examined the credit report of over one million anonymized student loan borrowers who began repaying their student loans from 2002 to 2014, and then analyzed their repayment through 2016.
Here is what the CFPB found:
- More than 40% of student loan borrowers graduate with at least $20,000 of student loan debt: The CFPB found that the percentage of borrowers owing at least $20,000 at the start of repayment has more than doubled since 2002, from 20% to 40%. The percentage of borrowers owing at least $50,000 has tripled over the same period from 5% to 16%.
- Half of student loan borrowers are older than 34 when they start repayment: Since 2003, the percentage of borrowers starting repayment over the age of 34 has doubled – from 25% to 50%. Consumers who begin student loan repayment before the age of 25 also decreased from 30% to 15% over the same period.
- 30% of borrowers are not paying down their student loan balances after five years in repayment: The percentage of borrowers who have not paid down their loan balances has nearly doubled between 2008 and 2016, increasing from 16% to 30%. Since loan balances are not declining, this implies that even if borrowers are making student loan payments, those payments are not enough to reduce principal or cover the interest costs.
Only 20% of student loan borrowers have repaid their student loans within 5 years: Over the last decade, this statistic has fallen from 50% to 41%.
60% of borrowers who are not paying down their balances within 5 years are delinquent on their student loans.
If you are struggling to repay your student loans, you're not alone.
So, what can you can do about it?
Here are 3 ways to help ace student loan repayment:
1. Consider a federal repayment plan
2.Make an extra student loan payment
3. Consolidate your student loans
Dox Prep offers free student loans reviews. Call (888)428-0333 today to find the right solution for you.
