Statistics reveal that as far as household debt is concerned, student loans rank second only after mortgage in United States with USD$1.4 trillion. It has also been observed that as of 2018, the average initial salary for a college graduate is USD$50,390, which is a little higher by 2.8% as compared to 2017.
It was stated in the Consumer Price Index report that was released in July in the current fiscal year that rate of inflation increased by 2.9% as compared to the last one year.
In this write-up, let us find out how the student loan market or industry impacts the economy of any country.
Looking back at the causes leading to mortgage crisis
The penultimate months that led to the subprime mortgage crisis, it was found that more and more households banked heavily upon their home equity in order to access quick cash. It was during this time and the period following the subprime mortgage crisis, when people availed payday loans to overcome their sudden financial crunch.
Also, one of the main reasons for tapping into their home equity was to fund education for the children. However, when the housing bubble burst, the provision of using the home …