If it sounds like the run up to the housing market collapse, well, you're not wrong. But in this scenario, we're talking about an entirely different kind of 'safe' debt: federally-backed student loans.
You see, back in 2009, Congress adopted a program of income-based repayment for some federally-backed student loans. This allowed borrowers like Julie Chinnock, a 50-year-old woman who owes roughly $250,000 in loans for two bachelors, masters and doctorate degrees, to limit their monthly payments.
This created a problem for certain lenders in a relatively small sliver of the student-debt market: loans that have been bundled into securities and sold off to investors. Investors once prized these loans since they offered higher yields than more-risky products backed by credit-card payments.