Do you recognize the reality of figures of Seven Million and One Trillion dollars?
Can you identify why students feel troubled by debt problems?
Do you know small debt always generates large problems?
If not, then don’t miss the chance to learn the reality of this mystery revealed in this article. According to the Department of Education, United States of America, seven million students owe one trillion dollars in debt. You might be shocked by these figures, but the obvious reality is that small debts always cause larger problems. You should clear the misconception that larger debt problems are always caused by larger debts.
According to New York Times, graduate students borrow larger amounts of money, but their default rate is very truncated because they earn higher amounts than undergraduate students. The students of Law and Medical sciences owe $141,000 and $162,000 respectively, but their default rate is only 7% compared to 22% for the undergraduate students. The graduate students have a higher earning tendency as compared to undergraduate students who have lower income propensity. It is a big reality that students always fall in debt-related problems, but they need solution. Debt consolidation companies could be a good solution for these problems because they have a solution-based model to consolidate debts for students.
It’s a myth that debt problems are mostly caused by graduate students, but it’s only one side of the picture because only 2% of all debts have been borrowed by graduate students and undergraduate students cover a much larger percent of the total.
You may be intrigued by these interesting figures: only 2.6% of graduate students are unemployed, but a majority of high school graduates are still unemployed in the United States. Most students leave college without getting a degree and these students are a high proportion among the list of debt defaulters. These students borrow money, but they cannot pay back their debts and so debt defaults are triggered by these students.
According to figures, 3.2 million borrowers owe an average of $15,000 while another 29.4 million owe $26,000 of the total amount borrowed by loan gainers in the United States. Suggesting students borrow less is not the solution because a majority of students leave school without getting a degree. Bureaucracy is the biggest problem in tackling debt-related problems; students who actually need to get student loans can’t follow the process because it requires large amounts of paperwork to apply for student loans due to present income-based payment models in the United States and other countries.
Solving debt-related problems is an art because it’s very complex due to lots of technicalities and complexities involved in the solution. Students who don’t have the ability to get degrees from their respective schools should not apply for student loan programs because they’re part of the problem instead of the solution. I’d like to suggest that students who have smaller debts should consult debt consolidation companies because a majority of defaults have been caused by students who hold smaller debts and it would decrease the ratio of defaulters amidst the list of debt borrowers in the United States