Even before COVID-19 came on the scene, student borrowers were on the brink. By 2019, student debt had become a crisis, with U.S. borrowers owing more than $1.5 trillion, an average of $34,000 each, with 1,400 borrowers defaulting every day, according to the Wall Street Journal.
President Biden has extended the pandemic student loan forbearance to Sept. 30 2021, with many people holding out hope of him canceling $10,000 in federal student loans. More than a third of federal borrowers could see their balances fall to zero with a $10,000 debt cancellation.
To see which states have the highest levels of student debt, AdvisorSmith, a business insurance research firm, used data on federal student loan portfolios from the U.S. Department of Education. To determine the states with the highest average student loan balances, they divided the student loan portfolio in each state by the number of borrowers in each state. To determine the states where the highest percentage of residents have student loans, they divided the number of outstanding student loan borrowers by the state population.
In 28 states, the average balance is higher than the national average of $34,000. Based on the research by AdvisorSmith, these are the states with the highest student loan balances.
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