According to a new report from the Federal Reserve Bank of New York, $40 billion in student loans are owed by Americans who are 60 years and older. Among these, more than 10% of the loans are delinquent and they say that most seniors are now using their Social Security checks to pay off the debt collectors who are harassing them day and night for recuperation of the money. The plight of unpaid student loan bills have become a cause of extreme concern within recent years and this is increasingly common with the seniors who are still saddled with student loan debt. Tuition costs are outpacing inflation and with the murky and the drab job market, student loan debt repayment has become a doubtful question among the borrowers, whether senior or young. Most seniors are spending their retired life counting their student loan debt numbers are searching for debt relief options.
The recent recession made it harder for the American seniors to repay their debt problems as jobs have become immensely scarce these days. Another big issue came with the Bankruptcy Abuse Prevention and Consumer Protection Act that passed the rule that private student loan debt can’t be discharged through bankruptcy. Due to lack of consumer protection, student loan debt gradually became impossible to erase with time and this gradually led to the student loan debt crisis.
Obama announces new plan to tackle the burgeoning student loan debt crisis
According to recent reports, President Obama while speaking at the Denver campus of the University of Colorado announced a new proposal for tackling the student loan debt crisis. Since 2014, the student loan payments will be reduced to 10% of the discretionary income of the borrower. The student borrowers will also get flexible options to consolidate their student loans at low interest rates. As the employment picture is still bleak in the US, student loan debt adds another obstacle to the better functioning of the economy.
If you owe student loan debt to the US Department of Education, you need not worry as you can take out a direct debt consolidation loan through which you can combine your multiple payments into a single monthly payment. The government will offer you flexible repayment terms and you can even switch from one repayment plan to another according to your changing needs. A single monthly payment will replace the multiple payment structure and repayment becomes easier and effortless. The payments that you make will be disbursed off to your creditors and you can thereby become debt free.
Being a senior and still owing debt is not only a shame for your own self but also for the nation. The economic factors are so poor that you couldn’t even earn money and repay your student loans. Manage your finances on your own so that you can make the timely payments towards the student debt consolidation loans and stop letting debts mar your golden years.
Jason Holmes is a regular writer with Debt Consolidation Care and is also a contributory writer with other financial sites