Regulators sound the alarm on student loans

When the prudential regulators get involved, the markets can assume financial authorities are worried about something.

As it turns out, regulators have student loan debt on the mind.

For that matter, so does the housing market, which lost a substantial portion of first-time homebuyers to student loan debt, which already has the young cash-strapped.

The Federal Deposit Insurance Corp., Federal Reserve and the Office of the Comptroller of the Currency issued a statement to financial institutions Thursday, asking them to work with private student loan borrowers.

"Student loan borrowers who are unemployed or underemployed may face hardship in making payments on their private student loan debts after separation from school or during periods of economic difficulty," the regulators said in prepared statements.

With this in mind, regulators encourage workout options such as deferrals, extensions, renewals and rewrites.

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