The total student loan debt in America is over $1.7 trillion as of 2024

The exact figure changes throughout the year as borrowers repay loans and new students take them out, but federal data consistently shows total student loan debt exceeding $1.7 trillion. This includes federal loans held by the Department of Education, federal loans held by private lenders, and private student loans. The number has grown steadily over the past two decades as college costs have risen and more students have borrowed to pay for education.

This debt is spread across roughly 43 million borrowers. The average federal student loan balance per borrower is around $37,000 to $40,000, though this varies significantly depending on whether someone attended a four-year university, a community college, or a graduate program. Private loan balances tend to be higher on average than federal loans.

Understanding the scale of student loan debt matters to homeowners and prospective homeowners because lenders look at your student loan balance and monthly payment when deciding whether to approve you for a mortgage. A large student loan payment can reduce the amount you can borrow for a home.

Key Takeaways

  • Total student loan debt in America exceeds $1.7 trillion and is held by approximately 43 million borrowers.
  • The average federal student loan balance is between $37,000 and $40,000 per borrower, though graduate degree holders typically owe significantly more.
  • Student loan debt affects your ability to get a mortgage because lenders count monthly loan payments as part of your debt-to-income ratio.
  • Federal student loans and private student loans are tracked separately, and they have different rules for repayment and forgiveness.
  • The total amount of student loan debt has grown faster than wages over the past 20 years, which is why more recent graduates tend to carry higher balances.

How student loan debt breaks down by loan type

Federal student loans make up the majority of the total — roughly $1.6 trillion of the $1.7 trillion total. These are loans issued directly by the Department of Education or through the Federal Family Education Loan Program (FFEL). Federal loans have income-driven repayment options, loan forgiveness programs, and protections like income-based payment caps that private loans do not offer.

Private student loans account for the remaining portion, roughly $100 billion to $150 billion. Private loans are issued by banks, credit unions, and other lenders. They typically have higher interest rates than federal loans, fewer repayment options, and no forgiveness programs. Borrowers with private loans have less flexibility if they face financial hardship.

The split between federal and private debt matters because your options for managing the debt depend on which type you hold. If you are trying to lower your monthly payment before applying for a mortgage, federal loans offer more paths forward than private loans do.

Why student loan debt has grown so much

College costs have risen much faster than inflation or wage growth over the past 25 years. The average cost of attending a four-year public university has roughly tripled since 2000, while median household income has not kept pace. Students and families have borrowed more to make up the difference.

More students are also attending college than in previous decades. Enrollment in four-year universities and graduate programs has increased, which means more people are taking out loans. At the same time, the share of college costs covered by grants and scholarships has shrunk, pushing more of the burden onto loans.

Interest accrual also contributes to the total. Federal student loans accrue interest while borrowers are still in school (except for subsidized loans, which do not accrue interest during school). This means a student who borrows $30,000 over four years may owe $35,000 or more by graduation. Private loans accrue interest even faster.

How student loan debt affects your ability to buy a home

Mortgage lenders use your debt-to-income ratio (DTI) to decide how much you can borrow. This ratio compares your total monthly debt payments to your gross monthly income. Student loan payments count toward your total debt, which means a large student loan payment reduces the size of the mortgage you can get.

For example, if you earn $5,000 per month and have a $500 student loan payment, your lender may only allow you to take on an additional $1,500 in monthly debt payments (including the mortgage, property taxes, insurance, and homeowners association fees). This limits the home price you can afford. If your student loan payment were $200 instead, you could may have access to for a larger mortgage.

Some lenders also look at whether you are in default or behind on payments. If you have missed student loan payments, it will show on your credit report and make it harder to get approved for a mortgage at all, regardless of your income.

The difference between federal and private student loan debt

Federal student loans are issued by the Department of Education and come with built-in protections. These include income-driven repayment plans that cap your monthly payment at a percentage of your discretionary income, deferment and forbearance options if you face hardship, and loan forgiveness programs like Public Service Loan Forgiveness. Federal loans also have fixed interest rates set by Congress.

Private student loans are issued by banks and other lenders and have fewer protections. Interest rates are typically higher and may be variable, meaning they can change over time. Private loans do not have income-driven repayment options or forgiveness programs. If you face financial hardship, your only options are usually to ask the lender for forbearance or deferment, which they can refuse.

Because federal loans offer more flexibility, borrowers with federal debt have more options for managing payments before applying for a mortgage. If you have private loans, your options are more limited, and you may need to focus on paying them down or refinancing them into a federal loan (if you are a federal employee or work in public service).

Student loan debt by education level

Borrowers who earned a bachelor's degree carry an average balance of around $28,000 to $30,000. Those who earned a graduate degree (master's, PhD, or professional degree) carry significantly more — often $50,000 to $100,000 or higher, depending on the field. Graduate programs last longer and cost more, so borrowers accumulate more debt.

Community college borrowers typically owe less than four-year university graduates, usually between $10,000 and $15,000. However, many community college students later transfer to a four-year university and borrow additional money, which increases their total debt.

The field of study also affects debt levels. Borrowers in fields like medicine, law, and dentistry often graduate with debt exceeding $150,000 or $200,000. Borrowers in lower-cost fields or those who worked through school or received scholarships may owe significantly less.

What happens to student loan debt over time

Federal student loans are designed to be repaid over 10 years under the standard repayment plan, though borrowers can choose longer repayment periods through income-driven plans. Income-driven plans can stretch repayment to 20 or 25 years, which lowers the monthly payment but increases the total interest paid.

Some federal loans may be forgiven after 20 or 25 years of payments under income-driven repayment plans, though this forgiveness is taxable income in the year it occurs. Public Service Loan Forgiveness can forgive federal loans after 10 years of payments if you work for a government agency or nonprofit organization, and this forgiveness is not taxable.

Private student loans do not have forgiveness programs. Borrowers must repay them in full or default. If you default on a private loan, the lender can sue you, garnish your wages, or sell the debt to a collection agency. This makes private loan default much more serious than federal loan default.

Frequently Asked Questions

Does student loan debt affect my credit score?

Yes. Student loan payment history is part of your credit report. If you make payments on time, it helps your credit score. If you miss payments or default, it damages your score. Your credit score affects the interest rate you receive on a mortgage, so student loan management directly impacts your home-buying costs.

Can I pay off my student loans faster to improve my mortgage chances?

Yes, and it can help. Paying down student loan debt reduces your monthly payment, which improves your debt-to-income ratio and makes you a more attractive mortgage candidate. However, paying off loans faster means paying less interest over time, so it is financially beneficial regardless of your mortgage plans. Check whether your loans have prepayment penalties before you start (most federal loans do not, but some private loans do).

What is the difference between student loan deferment and forbearance?

Deferment temporarily stops your loan payments, and on subsidized federal loans, the government pays the interest. Forbearance also stops payments, but interest continues to accrue on your loan balance. Both are temporary measures for borrowers facing hardship. Federal loans offer both options; private loans typically offer only forbearance, and the lender can refuse.

Will my student loan debt be forgiven if I work in public service?

Public Service Loan Forgiveness forgives federal loans after 10 years of payments if you work full-time for a government agency or a nonprofit organization. You must be on an income-driven repayment plan and make 120 may have access to payments. Private loans are not may be able to access. Check the Federal Student Aid website to confirm your employer qualifies before relying on this program.

How do I find out my exact student loan balance?

Log into your account at studentaid.gov using your FSA ID to see all federal student loans. For private loans, contact the lender directly or check your credit report, which lists all outstanding debts. Knowing your exact balance is essential before you apply for a mortgage, because lenders will pull your credit report and see the same information.