I'm sorry to hear that. I don't personally know anyone who landed in that situation. I do know a few people who needed to defer their loans for a few years, but in every case I personally know about, things have worked out.
I have, however, defaulted on my student loans, since I can not find any kind of job that pays more than my loan payments. My credit is wrecked, and any kind of retirement benefits I may receive in the future is forfeit (until the defaulted debt is payed back).
I'm sorry to hear you had such negative experiences.
Wikipedia says there are currently 4495 institutions in the United States; with so many schools the individual experiences are going to vary widly. A 2-year associates degree program from a state-run school averages $2544 per year, a 4-year program at a state-run university averages $4081 per year. Additional years of schooling (such as a six-year masters program or eight-year doctorate) cost more. Private universities can cost much more.
Here the biggest universities are from the state, and they're free. You just need a certificate that you finished secondary school ("high school" equivalent i think? ) for signing up. Some faculties require an exam before (i had to do an exam for engineering faculty), but there are "harder to get in" universities like Universidad de Buenos Aires which require a whole year doing some universally required courses, then pass an exam and then you can pursuit your degree. Is one of the best universities around though.
Last year the average government grant to students was $4115 per student per year, more than enough to cover the cost of an average 4-year university education at a state-run school.
If you live in a very expensive city (such as NYC or LA) many schools cost double or more than that average. If you go to one of the really high-end schools like Harvard, Yale, or MIT, expect to pay around $50,000 per year. On the flip side, if you go to a smaller school or live in a less expensive area the costs can be much less.
There are tests students take -- and can retake it if not satisfied with the results -- that is combined with grades to determine eligibility. Generally a state school will accept anyone, but the higher-ranked schools have more applicants and therefore must limit entrance to the higher-ranked students. The most prestigious schools have so many applicants that only the top-tier students are accepted.
Many students will attend a smaller 2-year program at a fraction of the cost to get their required courses. They will then transfer to a more expensive and more prestigious school for the following 2 years to complete a 4-year program of study.