The new research comes from a joint campaign between Student Debt Crisis Center (SDCC), the nation’s largest student debt advocacy organization, and Savi, a social impact technology company that helps borrowers get student loan forgiveness. The survey is the fifth installment over the past two years of the Student Debt x COVID-19 campaign looking at the toll the pandemic continues to take on a whopping 46 million student loan borrowers.
The survey also found that:
- 95% of Black borrowers are not prepared to resume payments on May 1.
- 93% of borrowers are not prepared to resume payments on May 1 and another 27% say they will never be able to resume payments again.
- 91% of fully employed borrowers do not agree with the idea that the economy has recovered from the impacts of the COVID-19 pandemic.
- 61% of respondents who could easily afford their student loan payments before the COVID-19 pandemic began are either struggling to make payments, cannot make payments, or are in default.
- Over half of borrowers say their student loan servicer has not contacted them to say that federal student loan payments are set to resume on May 1.
- Over half of borrowers lost their job, had reduced hours, or were furloughed due to the COVID-19 pandemic.
These results add important context around other obstacles facing student loan borrowers. Inflation is at its highest level in over 40 years and recent reports from the New York Fed and the Federal Reserve show that Americans shoulder the highest household debt increase since the 2007 recession. 85% of survey respondents reported that the payment pause is financial relief that they currently depend on, with low-income and working-class borrowers more likely to use monthly savings from federal payment pause to pay for food and healthcare or medicine.
“We have followed the experiences of student loan borrowers for over two years and we are saddened to report their circumstances are getting worse. Our findings show that the ongoing pandemic combined with unprecedented inflation are huge obstacles for borrowers who are, by and large, not ready to resume payments, struggling to afford basic needs, and confused about their options moving forward,” said Natalia Abrams, President and Founder of the Student Debt Crisis Center. “To meet this moment, we call for broad debt cancellation to repair the harm caused by this crisis and a roadmap to help borrowers navigate the uncertain future.”
“The vast majority of borrowers have not made a payment in over two years,” said Tobin Van Ostern, co-founder of Savi. “On top of the unprecedented pause, millions of borrowers are currently in the process of who will process their monthly bill if payments resume - the largest servicing transition to ever occur for borrowers. With both happening at the same time, clear guidance and communication to borrowers from the Department of Education is essential.”
The survey received 23,532 responses from people in all 50 states between February 1 and February 15, 2022. The 54-question survey was distributed via email to Student Debt Crisis Center followers that includes approximately 2 million people. Findings can be broken down by demographic, geographic, occupational and socioeconomic statuses upon request.
About Student Debt Crisis Center
Student Debt Crisis Center (SDCC) is a non-profit organization centering the needs and voices of borrowers and partnering with allies, to impact public policy and end the student debt crisis. The center works directly with borrowers to help them navigate the bewildering and frustrating loan repayment system and advocates for lasting and meaningful change. It leads a people-powered movement representing over 2 million supporters. Learn more at www.studentdebtcrisis.org and follow SDCC on Twitter at @DebtCrisisOrg.
About Savi
Savi is a social impact technology startup in Washington, D.C. working to solve the student debt crisis affecting 46 million borrowers by helping them discover new repayment and loan forgiveness options. Founded by long-time student loan experts and advocates, Savi is a public benefit corporation that works with employers, membership organizations, and financial institutions to provide our service as a unique student loan benefit. Visit Savi online at www.BySavi.com and follow on Twitter at @bysavi.
