National Student Debt Soars

EVANSTON, IL - Adam Arents mailed his first student loan payment this month. Like millions of other recent college graduates, he is beginning an uphill battle against debt.

“I always expected to be in debt,” Arents said. “Now I’m starting to feel the pinch.”

Arents, a 2006 graduate from Northwestern University, owes $15,000 in student loans over the next ten years. Others will not be as lucky.

Mathew Nusko, a current Northwestern sophomore, estimates that his debt will reach almost $180,000 by the time he graduates in 2009.

“I’m paying for everything entirely through loans,” Nusko said. “It’s just the way the system works. They overcharge you for your education. I come from middle-class America, but you can’t really do anything about it.”

With private school tuition rates on the rise, students and their parents are facing increasing pressure to borrow the money they cannot provide upfront. According to a 2004 study by the National Center for Educational Statistics, half of graduating seniors that attended private universities for four years have at least $19,500 in loans. One-fourth of the students have at least $28,000 in student loans.

Such findings have compelled organizations such as StudentPIRG, a grassroots movement founded in 1978, to focus on raising student awareness and confronting legislators about the rising price of education.

“The loan burden has just become overwhelming,” said Sasha Rosen, a campus organizer for StudentPIRG. “Students graduate and they have to push back marrying, having kids.”

Rosen also contributes to StudentDebtAlert.org, one of several new sites that offer a forum for the discussion on student debt. According to Rosen, anti-debt organizations like these recently achieved a tremendous legislative victory when Congress voted to cut federal interest rates on student loans in half on January 17^th.

Instead of relying solely on legislative action, some students choose to take matters into their own hands. All too often, however, this is not the case.

“There should be a mandatory class in college where students need to learn all the circumstances about student loans,” said Erin M., a team leader at EdAmerica. “It’s different case by case.”

According to Erin, who declined to release her last name due to company policy, students should consider options to alleviate debt such as consolidation, deferment, unsubsidized loans and forbearance.

“Students don’t take the two minutes it takes to learn about their loans,” Erin M. said. “Knowing about student loans is the difference between a $45,000 loan and a $30,000 loan.”

Northwestern, like most other private universities, maintains lists of preferred student lenders, such as EdAmerica or Sallie Mae. Students who have multiple loans often consult outside lenders that promise lower interest rates.

Charles Anderson, a student loan advisor with Student Lending and Consolidations, said the goal of the company is “to help people to consolidate college loans between lenders and students.” Anderson says that in general, federal loans are safer.

“I used to be very doubtful [of non-preferred lenders],” said Tatiana Rostovtseva, a sophomore at Northwestern University. “But if they can afford advertising, I don’t think they are a scam. If I were ever in a bunch of debt, I would use them.”

Other students are not as quick to trust these companies.

“I would never use one of those [get-out-of-debt-fast] sites,” said Akif Irfan, a Northwestern sophomore. “I feel like when it comes to issues with money, those are the times you want to stay away from less official resources.”

Regardless of how they choose to pay it off, debt is just a fact of life in the eyes of many students.

“I’ll be paying off my loans until I’m 46,” Rostovtseva said. “I’m used to being poor. It’s not really big deal.”

And as for Adam Arents, student debt has not detracted from his private school experience. He may not enjoy his first paycheck, but he has no regrets.

“I got a lot out of my education at Northwestern,” Arents said. “I worked with a lot of smart people and I had access to many resources. If I could go back and do it all over again, I would have done the same.”

*Medill students Paula Thornton and Libby Clarke co-wrote this story