Student Loans are the 2nd-largest Source of Household Debt In America, and Payments are Restarting. What does that Mean for the Economy?
As usual, one of the most informative and data driven article on the topic that I have seen to date. Great work.
Hi Joseph... great piece... one other looming issue for which I'd like to hear your thoughts... For borrowers on an IDR plan, the write-off of the remaining balance will potentially be taxable at that point in the future when they've finished the years of payments.
For PSLF, that write-off is explicitly non-taxable but my understanding is that for all non-PSLF plans, this was not written into the law and a temporary fix was added into one of the Biden COVID laws that only extends for a few more years. After that, absent congressional action, the write-off becomes taxable again.
This, of course, would be essentially unpayable when that was to occur. Do we just assume Congress permanently fixes this or is this more trouble down the road?
Have you ever looked at cohorted data? I've never seen such breakdowns, but you could get so more insight from them. You could look at loan balance remaining from a given cohort by years since. You could look at repayment rate by major. When college access is increasing, uncohorted data is just up and to the right.