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9.3 Million Student Loan Borrowers in Default, Up

By Drooid · Oct 16, 2026, 2:44 AM UTC · How we work

Summary

OBBBA Extends Repayment

OBBBA’s Repayment Assistance Plan now stretches federal student loan repayment to a 30-year term.
By June 30, 9.3 million borrowers were in default, up from 6.2 million in 2016.
Tuition rose 74% at private four-year colleges and 101% at public ones from 1995 to 2025.
National Student Clearinghouse reported a 9.6% jump in dual enrollment versus the prior year.
Revelio Labs found entry-level job postings fell 35% since January 2023, partly because of AI.

Summary

Experts Warn GoodDebt

Financial experts warn that calling mortgages and student loans “good debt” hides borrower risk.
Former FDIC chair Sheila Bair advises borrowers to ensure mortgage affordability and remain in the home at least five years.
Princeton sociology professor Frederick Wherry says the rich receive more good debt while desperate borrowers face bad debt.
Historian Hyman says New Deal credit primarily aided white married men, leaving Black Americans and single women without federal mortgages.

History

Historical Context

In response to the 1930s banking collapse, Congress passed the National Housing Act of 1934, creating the Federal Housing Administration under President Franklin D. Roosevelt. The FHA replaced short-term, 5-10-year mortgages that demanded 30-50 % down payments with long-term, amortizing loans requiring as little as 10 % down. This shift laid the foundation for later federal credit-insurance programs that still shape today’s student-loan debates.

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OBBBA Extends Repayment

OBBBA’s Repayment Assistance Plan now stretches federal student loan repayment to a 30-year term.
By June 30, 9.3 million borrowers were in default, up from 6.2 million in 2016.
Tuition rose 74% at private four-year colleges and 101% at public ones from 1995 to 2025.
National Student Clearinghouse reported a 9.6% jump in dual enrollment versus the prior year.
Revelio Labs found entry-level job postings fell 35% since January 2023, partly because of AI.

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