motherjones.com -- As tuition prices have soared, private student loans have become big business. According to the Department of Education, the percentage of students with private loans climbed from 5 percent in 2003-04 (about 935,000 borrowers) to 14 percent in 2007-08 (almost 3 million). The dollar amount of private loans swelled from $7.2 billion to $15 billion over that same period. These loans, like other non-federal lending, are largely unregulated. Like subprime mortgages, many have uncapped, variable interest rates that are sky-high for low-income borrowers, according to the nonprofit Project on Student Debt (pdf). But there's one key difference that sets them apart from shady mortgages: Unlike other debts, it's nearly impossible to discharge student loans in bankruptcy. And although precise data on private student loan defaults is elusive, "The volume of people in trouble is definitely increasing," Deanne Loonin, a staff attorney at the Boston-based National Consumer Law Center, told the Wall Street Journal.
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