It’s June and it looks like graduation season is in full swing. Meanwhile, student loan debt is on the rise and currently exceeds $ 1.16 trillion, outpacing credit card debt in the United States by $ 305 billion. There seems to be a ripple effect that this huge debt owes to college graduates. Enrollment continues to rise and jobs are scarce. It’s slowing down our economy and here’s why.
The economic markets that have been affected so far are the mortgage market, small businesses, retirement security, and consumer spending. When graduates have all their pay evaporated from debt repayment, they cannot buy a home, start a business, or save for retirement. We need to rethink how we pay for college and how much we are willing to pay for an education in America. Meanwhile, the debt burden of our future leaders is forcing them to live in abject poverty while paying.
Living in poverty can be a long-term condition, as these graduates pay off student loan debt that is more like a mortgage in the full amount owed. While an excessive current hardship is a step toward forgiving these bankruptcy loans, it alone is not enough to help. Bankruptcy courts across the country differ in their approach to determining student loan forgiveness, but most will use a totality of circumstances approach. Until Congress takes action to change current bankruptcy rules, the economy will continue to carry a heap of ever-increasing debt.
It is a proverbial “ball and chain” for Millennials. They are stuck at home with their parents, working part-time at minimum-wage jobs; maybe several just to pay off your loans. With no room for discretionary spending, which is a true sign of economic recovery, the drag continues. We see that the failure to launch has social implications for Millennials. Even students who have thoroughly prepared for the repayment period are having a difficult time. For a full report on the student loan crisis, click here. Graduates should not bear the financial burden of profit-greedy colleges and the ability of our federal government to collect on this debt indefinitely.
Criminals seem to have more rights than our college graduates. There is little incentive to make changes in Congress because the government is making money at the expense of our children and the future of our country through predetermined collection costs, administrators’ fees, and the ability to garnish wages and intercept refunds from income taxes without a court order. This student loan attorney believes it is time for a revolution.
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