That’s a record-high percentage of student loan borrowers who are currently at risk of default, which is alarming considering what’s at stake. As of this month, the federal government has resumed collections on all accounts that are in default. The financial reality for millions of Americans since dealing with their student loans along with their other debts. This situation has prompted CNN to seek input from those navigating the complexities of debt management in today’s economic climate.
According to recent data, we have reached the highest delinquency rate of any borrower cohort in history for student loan borrowers. Borrowers are increasingly falling behind on their loans—this spike in delinquencies is the most recent announcement from Census showing the alarming trend. Economic pressures, coupled with rising living costs, have made it increasingly difficult for individuals to manage their financial obligations effectively.
Now, with the federal government’s decision to resume collections on defaulted loans, the situation is even more complex and intimidating for borrowers. After a relief respite during the pandemic, millions of people are entering a new period where they’re going to be pressured to start repaying their debt. This resumption of collections could lead to further financial strain for those already experiencing difficulty in meeting their payment schedules.
CNN is on a mission to reach Americans drowning in student loan debt and other debt burdens. They are learning by directly interacting with the people who are experiencing these challenges. As a story-based network, we collect personal stories to humanize the impacts on borrowers. More importantly, it reveals the tactics District leaders employ to navigate this rocky terrain. We hope that their testimonies and experiences will lay bare what the state of play looks like when trying to manage debt in the current economy.
Beyond all the reasons why borrowers are struggling, the increase in delinquency rates stands as a heartbreaking testament to these students’ hardships. Others are struggling to keep up with their mounting financial obligations, creating a sense of insurmountable financial stress and anxiety about their future prospects. The scheme highlights the desperate need for better solutions and supports for those facing the burdensome reality of student loan debt.