Okay students, in what does easy money used to buy a product highly subsidized by the government result? Why, this.
- The delinquency rate for student loans made in the past two years is 15 percent – up from 12.4 percent in the 2005-2007 period.
- Subprime mortgage delinquencies stood at 15 percent in 2007.
- 19 percent of American households have a student loan debt.
- Over the last 10 years, tuition rose 60 percent at private colleges and 104 percent at public colleges.
- The average student loan was $27,253 last year, up from $17,233 in 2005.
- Total outstanding student loans top $1 trillion. That’s more than Americans owe on credit cards.
Furthermore, tuition rates have been increasing at rate faster than any other part of the economy.
If it sounds a lot like the housing bubble, it is because it is exactly like the housing bubble… only with nothing to repossess and no escape in bankruptcy.