I saw this article, and am wondering if anyone here is going to be able to disagree with it:

http://business.time.com/2013/02/04/student-loan-debt-crisis-howd-we-get-here-and-what-happens-next/?hpt=hp_t3

he amount of student loan debt and the rate of delinquency have been climbing for years now. If it seems like every new statistic is worse than the last, that’s because it is. Two studies released this week are no exception.

Credit bureau TransUnion says that in the past five years, the average student loan debt each borrower carries has risen 30% to $23,829. More than half of student loan accounts, which add up to more than 40% of the total dollars owed, are in deferral status. This is just a temporary reprieve; students can defer for only a few years before they have to repay.

The trouble is, many of them aren’t doing so. FICO Labs found that delinquencies rose by 22% in five years. For the newest group of loans it studied, delinquency rates are 15.1% — higher than the 11% cited by the Federal Reserve in a November report. Like the Fed’s study, the FICO analysis doesn’t include loans that are in a deferred status — which means the number of people who can’t afford to pay back that money may be almost twice as high as what the official delinquency rates reflect.

This situation obviously can’t be sustained over the long term. “I think a few more years and it’s going to be a general crisis,” says Barry Bosworth, an economist at the Brookings Institution. Interest rates are unusually low right now; when they rise, more borrowers who were just keeping their heads above water are liable to become delinquent.

I find it funny that student loans are becoming more of an issue, and schooling being relevant to work is also becoming more of an issue. When work places don't want to hire new grads because of their lack of work experience, the educational system is clearly failing.

This problem has been steadily building for more than a decade, and has gotten to be in a terrible way the past couple of years. When I graduated in 2004, job placement was at 20% for college graduates. That's down from 80% from only a few years before. Currently, 70% of graduated go back to living with their parents. It's not a crisis about to happen, it's already here. It's sort of like when politicians tried to spin that the economy was in a 'downturn', when it was in fact already in recession. The only answer is to forgive student loans, because the truth is that they can't ever be paid back. People are paying 10s of thousands of dollars in order to make minimum wage or close to it. They go into debt just trying to live ON TOP of the student debt they already have. This is an unsustainable loan issue that has proven to be broken, and it needs to end. Either create a free education system (which I would recommend), or only allow people that can afford to achieve higher learning without a loan to do so. Colleges constantly raising tuition during this crisis only makes things worse, and nothing is currently being done to help the people that the system relies on - the students.

That may be coming soon to the UK.

Tuition costs are now $42000 for a 3-year degree at most colleges. Now add the living cost loans. My brother will be about $80k in debt on graduation.

If $23k tuition+fees is a problem for the US, and our average is somewhere above $60k..

Good news for me. If there's a general crisis, maybe there will be an across-the-board writedown

I'm actually right on that average curve though, so i doubt any emergency actions would benefit me. If i can find a cheap enough apartment, i should be able to make repayments and be able to save a few hundred a month easy

Check this out

http://www.youtube.com/watch?v=24vp7WUjhzk

Been calling it for years. Not sure it will turn into a big macro economic issue though. Since all that money is owed to the government... and the government makes sure you pay eventually as it's the one debt you can't bankrupt yourself out of.

It will likely just push a lot of poorer unlucky college grads into deeper poverty, where they'll end up getting public welfare.

So it'll sort of just end up as something that blows up the governments deficit on both ends. Probably ending with some sort of government amnesty plan for student loans followed by a reform in how student loans are given out.

At that point a lot of the shady for profit colleges will probably go out of business... and honestly.... good.

Sucks for those college grads who get pushed into real poverty though, but that's just another uninteded consquence of poorly thought out policy meant to "better" people.

I was lucky enough to graduate without debt.

Student loan is truly demand to day which is also a great help for students who are helpless financially. Plus, our economic situation adds a pressure to withstand financial crisis. In fact, One of the classes of student loans, aside from private, Stafford subsidized and Stafford unsubsidized, is Perkins loans, which are need-based. As student loan defaults and Perkins loan defaults have risen, it’s brought consequences, such as lawsuits from schools against former students. Perkins loans are a subsidized federal loans. Funds are allocated to universities, who loan it to students. They pay it back with interest and the interest payments go to fund the unversities’ endowment.
However, just as with regular student loans, people are having trouble paying them back. From June 30 2010 to June 30 2011, $964 million in Perkins loans were defaulted on, a 20 percent rise in 5 years.

Source: Perkins loan defaults results in some universities suing students

Well at least I don't feel so alone now upon hearing this.. After my grad school is up (which thankfully is soon), I'm going to owe somewhere in the ballpark of 50 grand in loans. All I can say is I hope this degree pays off..