JumpCrisscrossStudent Debt Burdened Them, So They Moved Abroad and Stopped Paying
https://www.nytimes.com/2026/04/04/business/student-loans-abroad-default.html
People in The Netherlands have done this. They go to S/E Asian countries to skip out on a €30,000 debt. After a while your passport becomes invalid which makes travel very difficult. And with the outstanding debt you are not able to get a new passport.
Which is dumb, because you only have to pay off the debt if you are able to, interest rate is very low, you can pause it for a few years and after 35 years the loan is automatically forgiven. It's not a big deal. Completely uprooting your life to skip out on a €50/month payment is insanity but people see that €30,000 number in their portal and freak out about it.
Approximately 25,000 emigrated debtors are currently untraceable by the student debt collector.
In the US, student loan interest rates tend to be close to market (which I find despicable) and there is no automatic forgiveness. In fact, student loan debt has extra rules in the US making it difficult to get discharged in bankruptcy, so even that route doesn't work for a lot of people.
Had to look it up, it is 2.3% for 2026 which is a bit below the Euribor 1 year rate. Between 2017 and 2022 it was 0%.
Loan forgiveness happens after 35 years so for most academics that is about 10 years before retirement. Forgiveness also happens upon death.
Bankruptcy is a bit different here. We have a program where someone manages your finances for about three years, and after that most remaining debt is forgiven. However, student debt is an exception, that one stays
Yeah, I find this deeply frustrating. Interest rates are supposed to reflect the level of risk, and student loans are deeply low-risk to the lender.
> student loans are deeply low-risk to the lender
Based on the other comment, they absolutely reflect that.
I don't think the other comment is accurate.
https://studentaid.gov/understand-aid/types/loans/interest-r...
6.39% to 8.94%, and that's for Federal. Private ones tend to be even higher.
7/1/21–6/30/22 3.73%
7/1/20–6/30/21 2.75%
7/1/19–6/30/20 4.53%
7/1/18–6/30/19 5.05%
7/1/17–6/30/18 4.45%
7/1/16–6/30/17 3.76%Hmm. I wonder why it doesn’t make sense to launch a private lender that offers lower rates.
The Fed rate is too high for the low risk involved.
Private student loans are similarly protected from bankrupcty, and don't have things like income-based repayment; they are, if anything, safer for the lender. https://studentaid.gov/understand-aid/types/loans/federal-vs...
Sure. I’m saying why couldn’t you and I start C & J Lenders Inc. and undercut those guys. Say, 5% for a 20-year loan [1].
[1] https://home.treasury.gov/resource-center/data-chart-center/...
Same reason I can't easily start an AT&T/Verizon competitor.
Doesn't mean their pricing is that reasonable, or that funding education should be run this way in the first place. It just means there are big barriers to entry, often established by the existing players to protect their margins. The Fed rate for student loans should be lower.
> Passport Blocks: Arrears exceeding €5,000 can result in registration in the passport alert system, making it impossible to receive a new passport,
I would say that is pretty serious violation of human rights, for relatively small infraction. Soviet countries used similar system to prevent people from leaving their communist paradise.
How are you supposed to pay your debt, if you are not allowed to find new job abroad?!
US does same for very small child support debts (I think around $1000) as well as larger tax bills. Of course when I cross to/from Mexico by land at small crossing I've noticed most have no passport and just beg for forgiveness which usually works.
> that is pretty serious violation of human rights
I don’t think it’s that hyperbolic. But I agree that the existence of debts shouldn’t invalidate one’s right to a passport.
(The counter argument is that passports are a privilege and citizenship a bundle of privileges and duties. Why should the country have the burden of passporting someone abroad who as abandoned it.)
Education is also a privilege. And universities should have no power to block people from leaving a country. It is like Emirates preventing people to go home, because of unpaid speeding tickets. Or Qatar confiscating passports of Indian workers.
> universities should have no power to block people from leaving a country
They don’t.
They do, state owned education
In the US, student loan interest rates and average amount of debt are generally much higher than other countries. And you your student debt is designed to be permanent so that even declaring bankruptcy doesn't discharge it.