Americans Face Credit Hit as Student Debt Goes Delinquent Again
Over 10 million Americans are behind on student loan payments, with two-thirds seriously delinquent. Late payments will impact credit scores from October, despite some relief from Biden's initiatives.
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Millions of Americans are struggling to keep up with student loan payments following the end of the pandemic-related payment freeze. A report from the Government Accountability Office indicates that approximately 10 million borrowers, which represents over 25% of the total, were behind on their payments as of January. Of these, around two-thirds were more than three months late, categorizing them as seriously delinquent. Starting in October, late payments will be reported to credit bureaus, which could negatively impact borrowers' credit scores. While President Biden's debt relief initiatives have provided some assistance to borrowers, the overall situation remains concerning as many face the risk of credit damage due to delinquent payments.
- Over 10 million Americans are behind on student loan payments.
- Two-thirds of delinquent borrowers are more than three months late.
- Late payments will start affecting credit scores from October.
- Biden's debt relief plans are helping some borrowers stay current.
- The end of the pandemic payment freeze has led to increased delinquencies.
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