HIGHER EDUCATION BUBBLE UPDATE Burying Our Future Under A Mountain of Debt: The Real Meaning of $1 Trillion in Student Loans.

The CFPB is currently trying to estimate the size of the private student loan market. It’s breadth, and its current rate of growth, will tell us just how onerous America’s education debt load has become. Federal student loans come with certain protections, such as low interest rates and income-based repayment plans that can cushion the impact on a borrower’s finances. Private loans don’t have that. If a college freshman naively takes out too much money from a bank, they’re stuck paying on the bank’s terms. Between 1999-2000 and 2007-2008, private borrowing grew fourfold, from $4.5 billion to $21.8 billion. One study found that one third of the class of 2008 graduated with such debt, averaging $12,800 each. The CFPB says it will have a more complete picture by this summer, but if private borrowing has continued on its dramatic upswing, it will spell more trouble ahead. Certainly, we should expect more delinquencies and defaults.**

In any event, all signs point to this situation getting worse before it gets better.

Yep.