Newsweek - An estimated 7.5 million borrowers are in default for their student loans, according to data from the Department of Education, and defaults may rise with the pause on collections ending. Over 43 million Americans have student loans, and about one-third of borrowers say their loans have delayed them from buying a home, according to Gallup.
First-time homebuyers are at a record low, and student loans can make it harder for people to save enough to afford a home in the current market.
A default on a federal student loan, or any line of credit, can result in a lower credit score and adverse action on a person's credit report. Negative marks can also stay on a credit report for a long time. Equifax, one of the three major credit bureaus in the U.S., notes that accounts that have been sent to collection agencies stay on a person's report for about seven years.
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