Crazy: The 90 day student loan delinquency rate spiked up to 7.7% overnight once payments resumed
This is projected to rise to 45%
We all know life is unaffordable as it is without student loans to pay off.
The straw that broke the camels back
— QE Infinity (@StealthQE4) May 14, 2025
Student loan repayments have resumed, and millions of borrowers are already struggling to keep up. The official 90-day delinquency rate has surged to 7.7%, marking a sharp increase from 0.53% in the previous quarter. This is the highest spike recorded since payments restarted in May 2025, after a five-year pause.
While the official delinquency rate reflects borrowers who are 90 days past due, financial analysts warn that up to 20% of borrowers are facing significant repayment issues. This broader estimate includes those who have missed multiple payments but may not yet be officially classified as delinquent. The Department of Education estimates that nearly 10 million borrowers could fall into default by the end of summer.
Some borrowers might be able to avoid default by making small payments, even if they can’t meet the full monthly amount. Federal income-driven repayment plans allow some borrowers to qualify for $0 monthly payments, while others may be able to pay as little as $10 or $20 to keep their loans from falling into delinquency.
For those who don’t qualify for reduced payments, partial payments may still help delay severe penalties. However, if the borrower doesn’t meet the minimum required payment, interest continues to accrue, and the loan status may still shift to delinquent. Borrowers struggling to pay should contact their loan servicer to explore options like forbearance, deferment, or income-driven repayment to prevent default.
The strain is becoming unbearable. With inflation cutting into household budgets, borrowers juggling housing, food, and transportation costs are finding student loan payments nearly impossible to manage. Many hoped for debt relief, but legal battles halted major forgiveness plans, forcing repayments to resume at full scale.
Every dollar in unpaid student loans eventually falls on taxpayers. The longer borrowers avoid repayment, the more strain it puts on public finances, especially with interest rates on national debt climbing.
The federal government has already absorbed billions in unpaid student debt, and with trillions in total national debt, the burden keeps growing. Allowing borrowers years of deferment without strong accountability only exacerbates fiscal instability.
Sources:
https://ycharts.com/indicators/us_student_loans_delinquent_by_90_days
https://www.cbsnews.com/news/defaulted-loans-restart-collection-delinquency-may-5/
https://www.paymentsjournal.com/delinquencies-run-rampant-as-student-loan-collections-return/