Study Finds Student Debt is on the Rise in Brampton
Student debt is a growing problem that affects many students, even in Brampton.
According to a study conducted by Hoyes, Michalos & Associates Inc., student debt contributes to 1 in 6 (17.6%) insolvencies.
"Nine years ago, student debt insolvencies were just under 13% of all insolvencies we filed," says Ted Michalos, the co-founder of the company. "Today, 18% of the clients we see are struggling with student debt. It's an epidemic."
According to the study, the average insolvent debtor with student loans still owes $14,729 in student loans representing 32% of their unsecured debt, years after getting out of school.
In Canada, government-guaranteed student loan debt is automatically discharged in a bankruptcy or consumer proposal if the debtor has been out of school for a minimum of seven years.
Private student loan debt has no waiting period.
"The people we see coming into our offices struggling with student loans are getting younger each year," adds Doug Hoyes the second co-founder of the company. "Today, 31% of student debt insolvencies are filed by young people under the age of 29. This rate was just 21% in 2011."
There are many reasons for the increase, including tuition and residence costs rising, pressuring students to borrow more.
Many graduates are often working in part-time positions and minimum-wage or low paying jobs. Many don't find employment in their field of study that pays enough to repay their student loans.
"We believe it's time to eliminate the waiting period to have government student debt discharged through a bankruptcy or consumer proposal," says Hoyes. "There is no such waiting period for private student loans, and there is no difference in how students use either government borrowing or private borrowing. It is inequitable to penalize a student just because they used government student loans when another student using private debt can get relief immediately."
What do you think about these findings?
- 11-year-old from Brampton hoping to win this season’s grand prize for America’s Got Talent
- Two Brampton man face charges after woman is struck by car
- COVID-19 hits more schools amid growing fears of pandemic’s second wave
- Police investigating robbery at gunpoint in Brampton
- Police seeking public’s assistance in identifying suspect in connection to sexual assault in Brampton
- University Students In Brampton Use Dating To Reduce Student Debt
- Are Some Brampton Students Dating to Pay Off Student Loans?
- Province Making Changes to Student Loans in Brampton and Beyond
- Tips on Managing Debt When Interest Rates Rise
- Government to provide $1250 a month for students with Canada Emergency Student Benefit