Experian finds total student loan balances increased 149 percent since 2007

Career Climbers / 31st August 2017

Over the last decade, student loan debt in the United States has grown more than $833 billion to reach an all-time high of $1.4 trillion. Experian®, the leading global information services company, analyzed data from its consumer credit database and found that 13.4 percent of U.S. consumers, spanning from the Silent Generation to Generation Z, have one or more student loans on file.

The analysis shows that while student loans constitute the largest amount of non-household debt and the fastest growing debt segment, there is a lower percentage of late payments on these loans.

“Student loan balances are on the rise, which is a result of the increasing cost of higher education. Even with this number moving upward, the data is showing a decrease of delinquencies, which means that consumers are managing their loan payments better than they have in the past,” said Michele Raneri, vice president of analytics, Experian. “A student loan is an investment that can benefit someone for a lifetime. Making more informed decisions is essential for consumers and lenders alike. Lenders need deeper insights into the consumers they are lending to, and consumers — particularly younger borrowers — need a better understanding of how to manage their obligations.”

Key findings from the study include:

  • The average total student loan balance is $34,144.
  • The average VantageScore® for consumers with one or more student loans is 650 — 25 points lower than the national average of 675.
  • Consumers are taking out multiple student loans to fund their education:
    • The average number of student loans is 3.7 per person, up from 2.4 in 2007.
  • The percentage of late payments has dropped 10.1 percent since 2009.

Generational findings include:

  • Generation X has the largest outstanding balance — $39,802.
  • Generation Y has the largest number of loans — 4.4 per person.
  • Generation Z has the highest percentage of loans currently in deferment — 77 percent.

Regional insights 
Regionally, the study found that consumers on the East Coast tend to have higher student loan balances. Gainesville, Fla., has the highest average balance at $42,400, while Glendive, Mont., has the lowest at $20,200.

Student loan balances by metropolitan statistical area (MSA)

Highest

     

Lowest

Metropolitan 
statistical area

 Balance (in 
 thousands) 

 

Metropolitan
statistical area

 Balance (in 
 thousands) 

Gainesville, Fla.

$42.4

 

Sioux City, Iowa  

$24.9

Washington, D.C.

$41.4

 

Laredo, Texas  

$24.5

Charlottesville, Va.

$40.8

 

North Platte, Neb.  

$22.4

Atlanta, Ga.

$40.4

 

Harlingen, Texas  

$21.0

San Francisco, Calif.

$39.2

 

Glendive, Mont.  

$20.2

“In most cases, higher education is worth the investment because student loans pay off in the form of higher income over time. But it’s especially important for young people to understand the terms of their loans,” said Rod Griffin, director of public education, Experian. “Failure to repay even one of the loans or poor payment behavior could do long-lasting damage to your credit history and scores. Just as the value of your degree is measured over your entire career, how you manage your student loans will impact your financial future.”

An infographic featuring additional data on student lending is available here.

Educational resources 
Experian is committed to helping people reach their financial goals. On Tuesdays and Thursdays at 2:30 p.m. Eastern time, Experian’s director of public education, Rod Griffin, hosts a live Q and A on Periscope, where he answers a variety of questions on topics like ways to avoid financial stress, how to create a budget and savings tips for students.

Other ways to chat with Experian and learn more about credit:

  • Get helpful credit and personal finance tips (and take a behind-the-scenes look at Experian) daily on Snapchat.
  • Join #CreditChat, hosted by @Experian_US on Twitter, with financial experts and consumers every Wednesday at 3 p.m. Eastern time.
  • For answers to common questions, advice and education about consumer credit, visit Experian’s one-stop resource at http://www.experian.com/education.

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