The New York Federal Reserve reported a dramatic increase in serious delinquency among student loan borrowers, reaching 10.2% for the second quarter. The rate for borrowers over 50 exceeded 18%, indicating serious risks for older borrowers. With federal student loan collections restarting after a five-year pause, many borrowers will soon face wage garnishment and impacts on credit scores. About 5 million borrowers are currently in default, with projections suggesting that millions more could default as early as this summer, particularly in July and August.
The New York Federal Reserve's report revealed a worrying increase in serious delinquencies among student loan borrowers, reaching 10.2% in the second quarter.
For borrowers over 50 years old, serious delinquency rates surged to over 18%. This demographic faces significant risk of default.
President Trump's administration is condensing the number of available income-driven repayment plans, raising concerns for those struggling with payments.
Approximately 5 million borrowers remain in default, with predictions indicating that millions more could default within the next few months.
Collection
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