A growing concern among economists is the rapidly increasing trend of student loan debt. The debt itself isn’t the only problem, but the subsequent number of defaults that occurs as a result has many worried about what the future holds. Many young adults over-borrowed and with few job market options available at salaries high enough to cover their debt payments, many are forced into financial insolvency. The educated poor is quickly becoming a noticeable demographic in our society today.
Managing The Madness
Unfortunately for graduates, student loan debt is not a debt that typically qualifies for bankruptcy protection. It is very rare for any student loan debts to be accepted into a bankruptcy filing or approved for discharge by the court. Although most student loan lenders offer some options for those experiencing financial hardships, research indicates that very few graduates actually pursue these debt relief options.
As a result of high debt burdens and minimal debt relief options, many graduates are securing debt consolidations or settlements at the expense of their credit futures. Many companies are promising lavish guarantees of relief from debts, but at what cost? With young adults putting their credit standing in jeopardy for the future, it is expected that these same adults have the potential to damage crucial lending markets in the future such as mortgages.