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.
> 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.