Student loans: graduates aren't necessarily defaulting, but more and more are late.

Parents Forum
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<p>This article was reprinted in the Baltimore Sun this morning. It is a good discussion about what is happening with student loans. It talks about how young people really need to be educated on how to postpone payments should they get into trouble paying back their debt and says "41 percent of student loan borrowers experience delinquency." Not a good number.</p>

<p>Educating borrowers, according to the article can cut delinquency by 50 percent.<br>
However, according to the article:

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American Student Assistance is a non-profit, but with guaranty agencies trying to make money, Chromy said, the system puts borrowers at a disadvantage. She said that agencies make more money if borrowers default than if borrowers are able to pay off loans, which creates disincentive for education and assistance.

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<p>I don't know whether I can list a link from the article for borrowers with questions, but I trust that it will be deleted if it is not allowed. The link for the National Student Loan Data System is nslds.ed.gov for people who have questions.</p>

<p>Student</a> loans: More college graduates are delinquent on repaying student loans - latimes.com</p>

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<p>I am not surprised. The information is out there but it can be confusing and if you don’t know about it in the first place, you don’t know to look.</p>

<p>My son’s loans start repayment in May. Fortunately he only has around $9,000, but he is very conscious of his credit rating (which is excellent) and was very aware that the loans were due to go into repayment. He was getting nervous about how and where to repay them as the information was somewhat lacking. His loans have changed hands several times. He was relieved to finally receive some paperwork last week. He really wants to consolidate his loans just for the convenience of making a single payment. He would not have even know that consolidating was an option if I had not told him to look into it (his loans were not direct loans and I am not sure if he actually can consolidate them).</p>

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<p>I suppose the economy contributes to this number, but these default rates should be considered by anyone thinking about borrowing for college.</p>

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<p>One of the schools I visited claimed that only 0.1% of their students that take out loans default on them. I wonder if the number “late” or “delinquent” would be as favorable.</p>