When the federal student loan program was first introduced years back (1965), it was considered by all to be a really good idea. You would have had the option to borrow so as to complete your college and then pay back the money after you get a job. But, today the scenario has changed a lot and this has happened mainly because, most of the borrowers are held back by the immense amount of debt that has built up due to the lack of various other complex financial situations. Majority of the people are so deep into debt that sometimes getting assistance seems to be not enough for handling the debt complexities. The student loan debt and economic recovery; The student loan debt in America has reached to such limits that it is said to have surpassed even the amount of credit card debt and also the auto-loan amounts. The little signs of recovery that were seen is said to have been jeopardized by the immense amount of student loan debt that have piled up over all other kinds of debts.
The job market is still not stable and so most of the students who have passed out has still not been able to get any proper jobs. As a result, it has become increasingly problematic for them to make the payments on the student loans along with the other debt payments and in addition the other expenditures too.
Moreover, now the situation continuously is becoming more and more worse. This is because, with time and with no job in hand, most of the students are returning to school. Thereby, this again is resulting in higher indebtedness for almost all of them. According to the recent reports, the student loan debt on an average has topped over $25,000. This is said to have upped the percentage by quite a considerable amount in the last ten years. It has increased by 25% in the recent years. This constantly growing student debt is said to have a direct impact with regards to the taxpayers.
This is because, almost all of the student loan debts in the ratio of 8:10 are government guaranteed. The President has proposed various techniques and plans which are mainly aimed so as to fine-tune the whole loan system and the payments – so as to make it easier. However, there seems to be no immediate relief from the circumstances of the former students who have failed to pay off the students loans and are burdened with other debts too. The GOP presidential candidates too have given no such importance to this issue and rather are said to have dismissed the whole of this issue.
Some have also labeled the now president as “a snob” urging all of the people to get more and more of the higher studies which can help them get better jobs and thus higher salary. This again is supposed to help them do away with the problem of the debt load resulting from educational loans. The growing student debt has mainly resulted from the escalating cost of school fees too. but, according to Newt Gingrich the student loans is more of a type of tax. According to a research by the Federal Government, it has been found that most of the people who are 60 years and even older still now owe around $36 billion under the banner of the student loans.