Recently, a particularly painful phenomenon has emerged: over 9 million student loan borrowers in the US have started to default on their loans. This is not a low-probability event, but an ongoing debt crisis.

Here's what happened. During the pandemic, the US government granted student loan borrowers a "buffer period"—no repayments and no interest accrual. The Trump administration launched this policy in March 2020, and the Biden administration extended it eight times, effectively freezing repayments for three and a half years. As a result, over 45 million borrowers temporarily took a breath, and the overall student loan delinquency rate even dropped below 1% at one point.

But good times didn't last long. Repayments resumed in October last year, and by September this year, delinquency records were once again included in credit reporting systems. This caused a shock. According to data from the Financial Times, over 9 million people have missed at least one loan payment this year alone, with delinquency amounts doubling compared to during the pandemic. TransUnion's latest statistics are even more alarming: as of February, approximately 20.5% of federal student loan borrowers were overdue by more than 90 days, nearly double the 11.5% before the pandemic, and surpassing the 15.4% during the 2012 financial crisis.

Where is the root of the problem? Simply put, "Americans have run out of money."

On the surface, the US unemployment rate still looks decent, but employment prospects for young people are already grim. In 2024, the unemployment rate for those aged 15 to 24 has reached 9.39%. Many college graduates can't find jobs that match their salaries, and paying over two hundred dollars a month in student loans has become a burden.

Worse still, the US is still struggling under the dual pressures of high inflation and high interest rates. Rents, food, and fuel costs have already consumed most of household income, making student loan repayments the easiest to cut. There's no choice—people still need to eat and pay rent.

Interestingly, this wave of delinquencies is not only hitting recent graduates but also middle-aged individuals in their 40s. But the hardest hit are borrowers with low credit scores—over 50% of them are severely delinquent, while borrowers with good credit have an overdue rate of only 0.9%. In other words, this debt crisis is precisely targeting low-income groups.

How serious are the consequences of overdue loans? Once credit is damaged, applying for a mortgage or car loan becomes nearly impossible. Some states even revoke driver's licenses for unpaid debts, creating a vicious cycle: can't repay loans → credit worsens → harder to find jobs → can't repay loans. The path for ordinary families to buy homes and build assets to improve their social standing is almost completely blocked.

On a macro level, although this problem has not yet triggered systemic financial risks—US household debt-to-asset ratio remains below 11%, at a historic low—the drag on consumption has already begun to show. Morgan Stanley estimates that increased monthly expenses due to forced repayments could reduce the US real GDP growth rate by 0.05 to 0.15 percentage points in 2025. It may seem small, but when scaled to the entire economy, it is significant.

Ultimately, the fact that 9 million people cannot pay their student loans reflects a deep crisis in the US higher education financing system. The leniency policies are merely covering up the contradictions. Once these policies fail and the economy weakens, all problems will be exposed. What was once a "ladder" helping students change their destiny has now become a "shackle" restricting their lives.

How much impact will this have on the US economy? It depends on how the government handles it. In an environment of high interest rates and low growth, finding a balance between "encouraging repayment" and "ensuring people's livelihoods" has become one of the US government's most challenging issues. All of this will directly influence the pace of future economic recovery and the stability of society as a whole.