Student-loan borrowers now owe the federal government more than $1-trillion for the first time, the Consumer Financial Protection Bureau announced on Wednesday.
The swelling federal student-loan debt now sits at $1.2-trillion, the bureau estimated. The country passed the milestone with a fitting backdrop: the debate in Congress over student-loan interest rates. Rates for new borrowers of federally subsidized loans doubled, to 6.8 percent, on July 1, with Democrats and Republicans sparring, before and since, over the best way to set future rates.
Total student debt, including private loans, passed $1-trillion in 2011 and has grown by one-fifth since then, the bureau reported. Most student loans come from federal sources.
Politicians and policy makers are likely to use the figure to renew concerns about rising debt levels. The bureau reported in May that student-loan borrowing would have a significant economic impact, as it hurts young Americans' ability to save up to buy a house or car or to start a business.