The increasingly insurmountable student loan debt in the U.S. hovers around $1 trillion threatening the quality of life of those who can’t afford to make their payments. And he number of people heading into dangerous territory continues to grow.
The number of student loan debtors who are at least 90 days late on their payments has increased to 11.7 percent, up from 8.5 percent in 2011, according to a study by the Federal Reserve Bank of New York. And if you don’t include students who have deferred their payments, delinquency rates could be as high as 30 percent, according to a different study conducted by the New York Fed.
This clearly shows that with balances swelling, minimum payments are becoming higher, and students are consequently missing payments. The states with the highest delinquency rates are West Virginia (17.8 percent), Louisiana (17.1 percent), and Arkansas (16.4 percent). Puerto Rico is in there too with 16.7 percent delinquency. Other states on the list with high levels of student loan problems are Florida, Texas, and Rhode Island.
South Dakota is the state with the lowest rate of student loan delinquency at 6.6 percent, although it is among the highest for percent of consumers in the state with student loan debt at 20.3 percent. Only 14.4 percent of West Virginia consumers have student loan debt.
The US student loan situation is dragging down the recovery of the US economy. Student loan reform is up for discussion within the Obama administration, with interest rates scheduled to increase this summer. With the debt reaching crisis levels, Congress should keep rates at the current levels.