Lauren Aratani of The Guardian spoke to research associate Eduard Nilaj about the impacts of student debt, in light of the Supreme Court’s block of Biden’s debt cancellation plan.
The impact that student debt has on the financial future of Americans most clearly showed over the pandemic, as student loan payments and interest have been paused. Research from the Jain Family Institute showed that the three-year payment pause improved the financial wellbeing of borrowers, who saw improvements in their credit scores and a decline in delinquencies. More borrowers were able to get credit cards and auto loans and purchase homes for the first time in years.
“Home ownership is the best way to build wealth, and especially pass down wealth. What we’ve seen in the last decade is that home ownership among young Americans who have increased student debt has declined,” said Eduard Nilaj, a research associate at the Jain Family Institute.
“Since the repayment pause, we actually have seen a change in course where … individuals that are in debt have actually managed to join the housing market as a result of them not having to pay their increasingly large student loans.”
From the series:
Millennial Student Debt