Yesterday, the New York Times reported that college students in the class of 2010 now owe an average of $25,250 – up 5% from last year. Apparently, this is a new record, and is coupled with a 9.1% unemployment rate for new college graduates – also the highest in recent years. Mark Kantrowitz, publisher of Finaid.org and Fastweb.com, predicts that the class of 2011 will face an average debt of $27,200.
Oh, the places we will go…
Earlier I posted on a story about people fleeing the country to avoid their student loan payments. There weren’t many specifics, but I then came across this article on CNN.com. (Thanks to this blog). So wow – people are really doing this.
While most Americans are burdened with debt of some kind, student loan repayment can be a particularly scary prospect for young people struggling to start a career. Payments are often higher than expected, and the loans can’t easily be discharged. Added pressure from debt collectors causes some grads to flee their loans by fleeing the country.
“These are people new to borrowing and they didn’t understand what they were getting into,” says Mark Kantrowitz of Finaid.org, an online student loan information Web site. “It’s a very sorry situation that it comes to students feeling they have no option than to leave the country,” he says. “It’s a sign the system is broken.”
Apparently, it’s harder to find people with international addresses and it costs more for the collection agencies so they don’t feel as much incentive to go after these students. Two words: Bon Voyage.