Why the dentist with $1 million in pupil financial obligation spells difficulty for federal loan programs
Joseph A. Pechman Senior Fellow — Financial Studies, Urban-Brookings Tax Policy Center
A current Wall Street Journal article informs a startling story of a University of Southern Ca school that is dental whom owes significantly more than a million bucks in student debt—a balance he’ll never ever completely repay. As he’s exceptional—only 101 individuals away from 41 million student-loan borrowers owe significantly more than a million bucks—his situation highlights the flaws in a student-loan system that provides graduate pupils and parents limitless usage of federal loans and large payment plans. The effect: Well-endowed universities and well-paid, well-educated borrowers benefit at the cost of taxpayers much less well-off pupils.
While borrowers with big balances aren’t typical, they take into account a share that is growing of student education loans.