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Almost half of US bankruptcy lawyers have seen a significant increase in the number of potential clients with student loan debt, according to a report from the association.
A survey released today by the National Association of Consumer Bankruptcy Attorneys reveals that almost half of US bankruptcy lawyers have seen a significant increase in the number of potential clients with student loan debt in the past three to four years, Bloomberg News reported.
Nearly 25 percent of the 860 attorneys surveyed said the number of potential student loan clients had increased 50 percent to 100 percent, while 39 percent of attorneys reported growth of 25 percent to 50 percent, the Los Angeles Times reported.
"Take it from those of us on the frontline of economic distress in America," William E. Brewer Jr., the group's president, said in a press conference today, the LA Times reported. "This could very well be the next debt bomb for the US economy."
Federal and private student-loan debt, which surpassed credit-card debt for the first time in 2010, is approaching $1 trillion, Mark Kantrowitz, publisher of FinAid.org, told Bloomberg News.
According to the LA Times:
The average student loan debt of 2010 college graduates topped $25,000 — the first time it has exceeded that inglorious mark. Graduating seniors had an average loan burden of $25,250, up 5.2% from the $24,000 owed by the class of 2009, according to the Project on Student Debt in Oakland.
Unlike credit-card debt, student-loans cannot be discharged in bankruptcy, and the report calls for a change in bankruptcy laws, USA Today reported.
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