“Outstanding student loan debt surpassed $1.5 trillion in 2018 – second only to mortgage debt”
This is one of the reasons why so many young people are attracted to ideas like free college and socialism.
FOX Business reports:
Mounting student loan debt stopping young Americans from buying homes
The declining U.S. home ownership rate can be partially attributed to rising levels of student loan debt, a new study found.
According to researchers at the Federal Reserve Board Division of Research & Statistics, a $1,000 increase in student loan debt can cause a 1 to 2 percentage point drop in the homeownership rate for borrowers during their late 20s and early 30s. The homeownership rate among young Americans fell nine percentage points between 2005 and 2014—and rising student debt accounted for about one-fifth of the overall decline during that time period.
If not for those increased student debt burdens, an additional 400,000 young Americans would have owned a home by 2014, researchers concluded.
Outstanding student loan debt surpassed $1.5 trillion in 2018 – second only to mortgage debt – doubling over the past decade.
But the effects of mounting debt reach beyond buying a home. The Fed study found that higher debt burdens negatively impact borrower’s credit scores – which can not only affect their ability to obtain a mortgage, but nearly all other types of credit as well.
The Fed concluded that the benefits of secondary education – including higher wages in some cases – are being “lessened” by the burdens associated with increasing student debt loads.
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