Delinquencies on student loans have surged as credit reporting activities restart. Borrowers in default may face reductions in Social Security benefits to as low as $750 as debt collection efforts resume. MarketWatch reports that Americans’ credit card debt has decreased, but overdue student loans continue to negatively impact credit scores.
According to Bloomberg, the delinquency rate driven by student loans has reached its highest level since 2020. The New York Fed warns that the rising default rate could lead to “grave consequences” for some borrowers. These financial challenges highlight the ongoing struggles many face in managing education-related debt.
— new from Axios