Student loan defaults are on the rise, and many banks have not been able to keep up with demand, according to a new report from Bank of American.
The bank said it expects student loan default risk to reach $4.9 trillion in 2021, up from $4 trillion in 2020.
BofA also said the number of student loan borrowers with student loan debt rose to 4.4 million in 2021 from 4.3 million in 2020, and its total student loan portfolio fell from $2.5 trillion in 2015 to $2 trillion in 2019.
BofA said the growth of student debt has contributed to rising student loan defaults.
Borrowers who default on their student loans face up to a year in prison and a $1,000 fine.
The bank also said more borrowers are struggling to make payments on their debt.