Based to the data gathered by the Federal Reserve, American students have higher student loan education than their credit cards. According to websites FinAid and FastWeb, outstanding student loan education amounted to approximately 830 billion dollars, compared to 826.5 billion dollars in credit card debt.
The rise in student education loan was attributed to the preference of students to use the scheme than paying it with credit cards that carry high interest rates.
Figures reveal that public and private tuition fees at universities increased up to 26,000 dollars, excluding housing and incidental fees, resulting to the utilization of student loan education to make up the difference between shrinking family incomes and high tuition fees.
To mitigate the rising rates of students’ debt, lawmakers proposed to impose rules to deal with student loan education crisis and to limit the amount of government loans provided to students who studied at for-profit universities. Another option being discussed is to consolidate student loan debt that offers low interest rate.
