Increasing college tuition results in more non-payments on pupil unsecured loans

More individuals have to take out unsecured loans to fund a college education than ever these days. An education is invaluable. However, the nearly insurmountable costs have led to higher rates of default on those loans. It is the students who profit the least from this system. Many live each week on payday cash loans just to pay back these enormous loans.

Cost of tuition increasing leading to more unsecured loans

The rising cost of tuition for higher learning is a trend that will continue and has continued for several years. This means students have to come up with more cash. Typically this means more personal loans are taken out. Loan providers have no problem with this. It doesn't make a difference to them. There is an 11 year high for installment loan defaults from pupils trying to go to college right now. This is what Fox News reports. The taxpayers turn out to be the ones who miss out when it comes to this problem since most students are applying for those loans from the government.

So many default on loans meaning billions are lost

Currently, the Department of Education has about $880 billion in federal loans on the books in 2011, and non-payments have been on the rise at the exact same time that expenses of tuition and room and board have. From 2005 to 2008, the cost of a year's college tuition and living expenditures rose from $28,505 to $30,258. There was increase in the loans defaulted from 2008 to 2011 from $33.5 billion to $58 billion in just the last three years.

There is an unpredictable workforce graduate students are expected to enter

An increase in tuition is something pupils have to face every single day. You will find more things to look at for pupils when it comes to challenges though. You will find fewer jobs available currently with fewer wages for college graduates. This means that pupils have to borrow more just to have a smaller chance of getting a job – and a smaller paycheck.

Articles cited

Fox Business

foxbusiness.com/personal-finance/2011/01/24/default-student-loans-pays/