On Campus

Jump in U.S. student loan defaults

From The Wall Street Journal:

The U.S. Department of Education, demonstrating the toll the sour economy is taking on recent college graduates, reported a jump in the student-loan default rate to 6.9%, from 5.2% a year earlier.

Raising the stakes for consumers and taxpayers, the amount that students are borrowing for their education has been increasing dramatically in recent years, with half a trillion dollars in federal student loan debt now outstanding.

Robert Shireman, a senior adviser to Secretary of Education Arne Duncan, says he expects the default rate, which reflects the early part of the recession, to continue to rise. “When people are facing a job loss, figuring out how to pay their student loan is not No. 1 on their list,” he said.

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