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Do Student Loans Pass The Grade?

It's widely known that millions of American students are supported by student loans. What's not as well known is how the student loan market works.
student loan concepts
By Christie Petersen
Updated on: November 10th, 2022

student loan conceptsIf the latest information released through the Federal Reserve Bank of New York (FRBNY) is any indication, the amount of student loan debt doesn’t make a passing grade. Part of the reason may be the ease of finding out information on student loans; while it’s easier to find out that that student loans are used to the education of millions of students in the United States, the same can’t be said about the student loan market itself, or how it works.

The FRBNY Consumer Credit Panel has created a report looking at the household debt and credit. The quarterly report looks at the overall student loan debt market and goes over “missing” information, such as graduate students, college drop-outs, and the parents of college students.

Below are two graphs from the report showing how prevalent student loan debt has become. The first chart shows the average amount of outstanding student loan balances; the second shows the percentage of past-due student borrowers.

Student Loan Borrowers By Age

The outstanding student loan debt by borrower is $23,000.00.

Past-Due Student Loan Borrowers By Age

It’s possible that due to how they are calculated, the delinquency rates for student loans are actually understated.

To read the Federal Reserve Bank’s quarterly report, you can obtain it from their website by clicking here. Please note that it’s a PDF, so you will need Adobe® Reader® in order to view the document.