Study: Student Loan Debt Amounts Surpass Mortgages

Research based on borrower data in the 50 largest U.S. cities shows trends toward some student loan balances soaring above mortgages.

10/22/2018 8:00 AM

Study: Student Loan Debt Amounts Surpass Mortgages

The student loan debt burden varies across U.S. metro areas and in some cities surpasses mortgage debt, according to a recent student debt study from LendingTree, the parent company for MagnifyMoney.

“Mortgage debt is still larger than student debt for most Americans, both at the national and individual level,” according to an article on the study from Magnify Money. “However, the results of this study show that in some places, a relatively large proportion of people face student debt that outweighs even their mortgage, which can be a significant financial burden.”

Overall, total outstanding student debt surpassed $1.5 trillion this year and overall it is second to mortgages considering loans with the highest balances for consumers.

However, a “substantial number” of consumers owe more than $100,000 on their student loans, according to the study.

“Student loan debt varies pretty widely between metros,” LendingTree senior research analyst Kali McFadden said in the article. “With student loan balances shooting up, we wanted to know how these types of debt stacked up against mortgages for people who carry both.”

To determine how consumers’ student loan burden is divided across the U.S. and areas where it compares to or surpasses mortgage debt, LendingTree compared student debt and mortgage debt using borrower data from the 50 largest metro cities.

Key findings include:

  • 5.7 percent of consumers in the 50 metro areas surveyed have a higher student loan balance compared to their mortgage. The average student loan balance across these cities was $18,435.
  • In six of the 50 cities (dominated by the “Rust Belt” region in the Midwest and Northeastern U.S. and the South) studied, more than 10 percent of consumers hold a larger student loan debt burden than mortgage debt.
  • Pittsburgh showed the highest student loan debt burden over mortgages, with 12.6 percent of consumers paying more for their educations than their homes. Buffalo, N.Y., has the second highest student loan burden at 12.2 percent followed by Cleveland with 11.7 percent.
  • Finally, cities on the West Coast are on the lower end of the student loan debt burden with 1.4 percent of consumers in Seattle and Sacramento, Calif., and 1.6 percent of consumers in Los Angeles and San Diego owing more in student loans than their mortgages.

Overall, there are 11 cities where student loan debt tops mortgage debt, according to the study.

“Clearly, property values pay a part in the ratio of student loan to mortgage debt … [however] we do see that higher student loan balances are a factor where more people owe more for their educations than they do for their houses,” McFadden said in the article.

Read more the complete study, including cities where student loan debt burden is lower than mortgages, online.

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