May 8, 2020

Private student loans offer little protection when things go wrong

Private student loans offer little protection when things go wrong


WASHINGTON, D.C. –As our higher education system is turned upside down, there’s reason to worry that more students will take out private loans and struggle to pay them back.

Private student loan debt is rising at a faster rate than federal student loan debt, according to an April report from the Student Borrower Protection Center. Since 2012, the volume of new private student loan originations has increased each year, but the volume of new federal student loan originations has decreased during that period.

“A lot of that has to do with the sheer cost of higher education in America,” said Seth Frotman, executive director of the Center. “We are just forcing more and more people to take on not only more credit and debt but riskier credit and debt to try to keep up.”



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