Posts Tagged ‘default’

“The married couple of 20 years is just a step away from financial disaster….

Millions of over-leveraged consumers – who can’t distinguish between a ‘want’ and a ‘need’, refuse to live within their means, require a certain standard of living, and use most of their available credit without knowing when or how they’ll pay it off – are a big credit risk. They live on the edge of default….

Inevitably, irresponsible lending always leads to a bust….  Credit-card debt is growing so fast, it’s even outpacing strong wage growth….

Trouble is brewing… It’s only a matter of time before this recklessness blows up.” -Bill McGilton

Private Debt

Posted: April 10, 2018 in Debt
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“The only ways out of private debt are to pay it, to default, or to have it forgiven.” -Porter Stansberry

“At more than $1.4 trillion in loans outstanding, student loan debt is nearly four times bigger than all the debts of Greece.  And it’s still growing at nearly 20% a year… multiple times faster than the official rate of inflation.  Worse, the government’s own data has showed as much as 30% of this debt – nearly one out of every three loans – isn’t being paid or is already in default….

At more than 1,000 schools – representing about one-quarter of all U.S. colleges and trade schools – more than half of students have already defaulted or failed to pay even one dollar toward these loans within seven years of leaving school.  Across all schools, the data show as many as 40% of borrowers haven’t paid a single dollar toward these loans within seven years.  Looking at just the past three years, this number jumps to more than half – 54% – suggesting this problem is only getting worse, not better.

In other words, according to the government’s own data, at least 40% of this debt – representing more than $500 BILLION that has been packaged up, ‘securitized’, and sold to investors as ‘money good’ – will likely never be paid back at all.” -Porter Stansberry