The Consumer Financial Protection Bureau released new estimates which place outstanding student loan debt near $1.2 trillion. Of that amount, the federal government holds or guarantees approximately $1.01 trillion worth of loans with the remaining amount comprised of private student loans.
At the end of 2011, total outstanding student loans were approximately $1 trillion. The 20 percent increase in student loan debt since that time greatly outpaced growth in revolving credit products (predominantly credit cards), which increased less than 2 percent during the same time period. Student loans now comprise the second-largest form of consumer debt behind home mortgages.
Statistics in the July 17 report for federal loans were taken from the Department of Education’s federal student aid data. Statistics for private student loan were calculated from an August 2012 report which put outstanding debt at the end of 2011 at $150 billion; estimated growth since that time was based on securitization filings and publicly available information.
A few weeks later, CFPB student loan ombudsman Rohit Chopra released further details about outstanding loans. Although Chopra’s blog post concentrates on federal loan programs, it does acknowledge that more than seven million borrowers are in default on a federal or private loan.
The data for outstanding federal loans was analyzed for the Federal Family Education Loan (FFEL) Program and the Federal Direct Loan Program as of June. Figures for these two programs reveal that approximately 4.4 million FFEL borrowers (19 percent) and 2.1 million Direct Loan borrowers (8 percent) are in default, with a total of approximately $89.3 billion outstanding. FFEL and Direct Loan borrowers in default had an average of $13,400 and $14,500 in outstanding balance, respectively.