Student Debt Holds Back First-Time Homebuyers
US student loan debt has become a significant barrier to home ownership in the United States, as borrowers imperil their finances simply trying to get through college or professional school.
About 45-M Americans have student debt, and the average borrower owes more than $30,000, according to the data.
More than 80% of young adults ages 22 to 35 with student debt who have not bought a house blame education loans, according to the National Association of Realtors (NAR).
“Student loan debt holders do want to own a home, that’s part of their American dream,” said the managing director of survey research at NAR. “It’s just really hard to get there right now.”
About 20% of people with student debt who apply for a mortgage are denied because they have high debt in relation to their incomes, according to the NAR.
Students who borrow more money for college than they’re able to pay back have multiplied to crisis levels – and the future is about to get much worse, especially for black debtors, according to an analysis by the Brookings Institution.
Nearly 40% of people with education debt may default on those loans by Y 2023, according to the think tank’s analysis of Department of Education data. Brookings studied past trends for default rates and projected them over the next 5 years.
Fully 50% Millennials shouldering student loan debt are so desperate to shed the load they would give up voting in the next 2 presidential cycles to even the balance sheet, a survey showed.
In the Credible survey, however, only 13% would give up texting for a year to be debt-free.
According to the Department of Education, 42.3% Americans are paying back $1.33-T in federal student loan debt, and lenders are collecting another $64-B in private student loans.