Student Loan Update: Nearly 13 Million at Risk of Default This Year
Summary
More than 12.5 million U.S. federal student loan borrowers could be late on payments or in default by the end of 2026 if current trends continue. The Department of Education data shows nearly 3 million borrowers are currently behind on payments, and over 9.5 million are already in default, meaning they have missed payments for a long time.Key Facts
- As of March, about 2.97 million federal borrowers were 30 to 270 days late on loan payments.
- Around 9.57 million borrowers were in default, meaning payments were 271 days or more past due.
- If payment problems continue, the total delinquent and defaulting borrowers could reach about 12.54 million by the end of 2024.
- Student loan debt averages about $29,560 for bachelor's degree holders and $39,500 across all federal loan borrowers.
- Graduate and professional students often owe much more, with dental, medical, and law graduates carrying the largest debts.
- Loan defaults damage credit scores and can lead to wage garnishment.
- The Trump administration is increasing efforts to collect payments, reversing the repayment pauses from the pandemic era.
- Many borrowers struggled to restart payments after the COVID-19 pause due to confusing rules and delayed credit consequences.
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