What is student debt crisis and why is it important?

I magine if you had to pay 18 percent interest today on a mortgage or auto loan. Absurd, you’d say, when the prime rate has hovered at 3.25 percent for years. But some students who seek loans in the private market have to pay such exorbitant rates, which is why relying on the private sector for student loans is a dangerous idea.

Few deny that we face a student loan crisis in America. Student loan debt has doubled over the past seven years and is now close to $1.3 trillion. About 40 million Americans have an average debt exceeding $27,000, and some end up paying back loans well into their 30s, 40s and even 50s. Student loan debt now surpasses debt on credit cards, auto loans and home equity lines of credit.

As debt levels increase, young people are forced to delay starting a family, purchasing a home, starting a small business and saving for retirement. This not only affects their lives, it impacts the overall economy.