1 million New Yorkers are carrying $ 35 billion in student loan debt

If suffering loves company, the more than 1 million New Yorkers who collectively carry $ 35 billion in student loan debt can console themselves by not being alone.

According to his commissioner, Lorelei Salas, the New York Department of Consumer and Worker Protection (DCWP) says that about 14 percent of city residents with student debt have expired 90 days or more for loan payments.

“I really care about this,” said Salas. “I graduated from law school with $ 150,000 of student loan debt. So I know what it does to people’s finances and their stress level. “

“It’s a long process,” added Salas, who still has nearly $ 50,000 in student loan debt. “There have been times when I thought,” I’ll never stop paying until I die. “”

Borrowers turned to social media and defense organizations such as the nonprofit student debt crisis to share their trouble stories (and even the results if they managed to pay off or kill their debts).

“For the past three years, I have done fairly solid work in a high-level university,” wrote a New Yorker on studentdebtcrisis.org.

“I make a pretty decent salary and I’m getting a free MBA. I have a 401 (k) and a Roth IRA and every month I put 25 percent of my salary on my savings account. I have about $ 45,000 in student loan payables – $ 15,000 in private loans and $ 30,000 in federal loans. I try to contribute $ 600 a month to these loans.

“Last year I contributed $ 1,762.12 to a large portion of federal loans totaling 25,000. Over the past year, total debt has fallen by $ 415. I put $ 300 in seven days ago and I already owe $ 20. I burst into tears when I realized that realization. For years the debt to my student loan has been this shadow that hangs over me. “

In fact, a Moody report in January found that slow repayments have become a key factor in what was the fastest growing type of household debt in the past decade.

Student loan debt rose to $ 1.6 trillion in the fourth quarter of 2019, according to the Federal Reserve. One in five adults – 45 million Americans – are contributing to the total.

Over the past decade, the aggregate annual net repayment rate (or the amount of existing balances eliminated each year) for student loans in the United States has been on average only 3% “, and many recent graduates have not paid their sale, “discovered Moody.

Meanwhile, the student debt clock on FinAid.org has risen by over $ 1.7 trillion and the issue looms over the run-up to the presidential election.

Suffering student loans pushed education concerns ahead of fears of job losses and a market downturn to become the first financial destroyer in a recent Harris poll on behalf of TD Ameritrade.

The results came in a period of low inflation, record employment, a growing market (pre-coronavirus), observed Tom Butch, managing director of retail distribution at TD Ameritrade.

In five years, education concerns have increased modestly, as student debt has risen by more than 25 percent at that time, particularly for millennials.

Former Consumer Affairs Department of New York DCWP has published three student debt reports, one of which in 2017 with the Federal Reserve Bank of New York examining student loan default and default rates in different neighborhoods , a study that has been replicated in other cities.

DCWP conducted debt clinics in targeted areas in 2018 based on the results of the Fed’s joint report: insolvency and default rates are higher in neighborhoods with lower median incomes.

It offers advice to student loan borrowers at nyc.gov/studentloans and provides free advice from financial empowerment centers in all districts.

There are many resources available nationwide, but borrowers should be careful to find one that offers student loan experience, be it a financial adviser, CPA or attorney, said Bruce McClary, vice president of communications for the National Foundation for Credit Counseling, which manages studentloanhelp.org.

He tries to stay away from profit-making debt reduction companies, he warned.

“Customers pay a lot of money up front and in many cases they are left in a worse case than when they started,” he said.

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