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Student Loan Debt: Wisconsin 3rd in Nation

Analiese Eicher of One Wisconsin Now says student loan debt is dragging down the state's economy and it's time for the Legislature to do something about it. Courtesy: One Wisconsin Now
Analiese Eicher of One Wisconsin Now says student loan debt is dragging down the state's economy and it's time for the Legislature to do something about it. Courtesy: One Wisconsin Now
November 16, 2015

MADISON, Wis. - The percentage of Wisconsinites with student loan debt continues to rise at a rate much faster than most of the rest of the nation. Analiese Eicher, program director with the advocacy group One Wisconsin Now, says 70 percent of the state's graduates are carrying student loan debt, leaving school owing tens of thousands of dollars apiece. She says the state ranks 17th in the amount of debt students graduate with.

"Which doesn't sound too bad, but the amount of debt is over $28,000," says Eicher. "But then the scary one is that we rank third in the United States of college students who graduate with debt."

A study from The Institute for College Access and Success found that over the past decade, ten percent more graduates were leaving school with student debt, and the numbers keep climbing. Eicher says at least 812,000 Wisconsinites are carrying federal student loan debt, totaling more than $19 billion.

Some Republicans, such as U.S. Senator Ron Johnson of Wisconsin, say they oppose student loan debt reform because there already are too many people in college, and they run up big debt because they like the college lifestyle and want to remain a student.

All that debt, and the monthly payments due on it, are a drag on the state's economy, according to Eicher, because graduates delay major purchases.

"We found that, in Wisconsin, if you have a student loan you are two-thirds more likely to buy a used car as opposed to a new car," says Eicher. "And you are also two-thirds more likely to be renting than owning your own home."

She estimates that represents more than 200 million dollars a year in new-car sales and home sales lost, because of student loan payments that must be made.

Many of the loans are at high interest rates, which cannot be refinanced. Advocates say the solution is to allow graduates to refinance their debt.

"And you can refinance every other kind of loan except for a student loan, and thankfully there's legislation that's been introduced in the last two legislative sessions that would allow for state-based refinancing," she says. "But it is still stalled in the Wisconsin legislature as Republicans have refused to take action on it."

At the federal level, similar efforts to allow the refinancing of student loans have failed, with votes falling along party lines: Democrats are in favor, Republicans are not.

Tim Morrissey, Public News Service - WI