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More students putting off student loan payments, Journal reports
09/28/2010
As the economy continues to recover from the 2008 recession, many college graduates are finding themselves buried in student loan debt without a steady income. The unemployment rate hit 9.6 percent in August, according to the U.S. Bureau of Labor Statistics, showing that it has been difficult for individuals to land a job, with or without a degree.
Michigan State University graduate Jason Chapman is just one of many individuals who has been struggling to pay the bills since he finished school in 2008. Even after settling for a number of odd jobs, Chapman has been forced to hold off on loan payments just to pay for other expenses, such as auto insurance and rent, according to the Lansing State Journal.
He is not alone on his decision to take on more loans and interest, however. Education Secretary Arne Duncan recently said the national default rate rose to 7 percent in 2008 from 6.7 percent in 2007.
Grads looking to avoid defaulting can consider consolidation or the income-based repayment plan. The plan caps monthly payments at no more than 15 percent of what a borrower earns.
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