Student debt surpasses credit card debt in America - FOX 29 News Philadelphia | WTXF-TV

Student debt surpasses credit card debt in America

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CHICAGO (FOX 32 News) -

For the first time in history, student loan debt has surpassed the total amount of credit card debt in America.

That staggering statistic has the attention of Washington and Illinois Senator Dick Durbin, who introduced a bill Thursday called the ‘Student Loan Borrower Bill of Rights.'

According to Durbin, the bill is designed to force universities to disclose all options students have before they take loans, and help students avoid bad advice from lenders.

"He doesn't tell you that if you sign up for the government loan, it's a lower interest rate. That you might have some of your loan forgiven if you go into teaching. Instead he pushes in front of you the private loan form. He doesn't tell you there is a higher interest rate. That there is no flexibility that you can't refinance. You're 19 or 20 and you sign up. Guess what? 3 or 4 years later when that loan comes due, you realize that the councilor didn't tell you the whole story," said Sen. Durbin.

The bill also takes aim at the for-profit college industry.

Senator Durbin said the industry only enrolls 10 percent of all college students, but receives more than 20 percent of all Title IV Funding Change, as well as accounts for 46 percent of all loan defaults.

"Some of these places need to be shut down. So many of them are under investigation today for fraud, it should be an embarrassment to the federal government. We owe it to the families and the students to stop these people from exploiting them," added Sen. Durbin.

According to the federal reserve bank of New York, before 2009, people with student loan debt were more likely than others to own homes and buy a new car. Now, the opposite is true.

Sen. Durbin admitted that this isn't a permanent fix to the growing problem of student debt, and that more could, and should be done.

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