The number of student loans being written off by banks is soaring. According to The Chicago Tribune, over $3 billion in student loans have been written off just in the first two months of this year. Seeing that the federal government has all but nationalized the student loan industry, the cost of most of those write offs will now be on the backs of the taxpayers.
Banks wrote off $3 billion of student loan debt in the first two months of 2013, up more than 36 percent from the year-ago period, as many graduates remain jobless, underemployed or cash-strapped in a slow U.S. economic recovery, an Equifax study showed.
The credit reporting agency also said Monday that student lending has grown from last year because more people are going back to school and the cost of higher education has risen.
“Continued weakness in labor markets is limiting work options once people graduate or quit their programs, leading to a steady rise in delinquencies and loan write-offs,” Equifax Chief Economist Amy Crews Cutts said in a statement. (Read More)
In this new normal Obama economy I guess this news is to be expected. But not to worry, the article also notes that the CFPB is on top of this matter. Oh wait, never mind.
Update: Linked by Expose the Media – thanks!