Report: Texas Favorable for Student Loans

More American students are borrowing until they're broke.  The total outstanding student loan debt nationwide now stands at $1.34 trillion, according to the Federal Reserve Bank of New York.  That represents an increase of $34 billion since the end of 2016.  The problem already has the attention of Congress, which is considering an overhaul of the federal student loan program.

A new study from the personal finance website WalletHub breaks down the student loan numbers state-by-state to give a clearer picture of which states are most or least favorable for student borrowers.  The study examined all 50 states plus the District of Columbia on factors including average student debt, overall economy and unemployment rate, the amount of loans past-due or in default, and availability of paid internships and student jobs.

The results of the study were favorable for Texas.  "Texas is actually toward the bottom of these rankings, and that's a good thing," says WalletHub analyst Jill Gonzalez.  "About 56-percent of students (in Texas) have student most other states that number is up toward 70-percent, so that figure alone means that less people than average are taking out loans to begin with in Texas."

Not only are fewer Texans borrowing, but those that do owe less.  "The average student debt (in Texas) is just over $27,000...that's about $10,000 below the national average," says Gonzalez.  She credits the overall strong Texas economy and the greater availability of grants in the state as factors in making Texas more favorable to student borrowers.

As for how much time the average American spends paying off their student debt, a recent report from The College Board found it takes 12 years to recoup the cost of getting a Bachelor's degree.

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