Student loans/debt responsibility?
 

I remember when I applied and was approved. I could not have been happier.

Oh but I was happier.....10 years later when I made my final payment.

Being one who honored their obligation while raising a family, buying a home, et al.....I am not a supporter of student loan forgiveness. All those who committed to repay, like me, knew what they were opting in for when they applied for and signed for the loan(s).

There is no excuse for not honoring the obligation and paying back the loan(s). Prudent and responsible budgeting makes it happen.

Not sure how long the thread will last before some posting violations cause it to be closed.....we'll see.

What would be next? Mortgage or car payment forgiveness for many of the same excuses?????

I totally agree, it encourages irresponsibility. And what kind of message does it send to those who planned, budgeted, and sacrificed to pay for their educations?

I almost have my U of MN Law School loan paid off. Been a hard road though. Could not use my law and librarianship degrees because I ****ed off the powers that be in law librarianship by wanting to be honest about the affect of the 2-24-1976 (my birthday) murder of Michelle Mitchell near the U of Nevada, Reno campus on me while I was earning four degrees and had represented prisoners through Legal Assistance to Minnesota Prisoners, a clinic at the U of MN Law School. My immediately prior Law Library Director at the U of MN became Law Librarian of Congress in around 1990. They made my concern about a niche in practical information for survivors/victims of crimes my psychological problem. Or sort of. At least my personal concern rather than a rightful concern of law librarians around the world.

I had to do this as a hobby from mid 1991 while enlisting any one I could think of to solve it through other ways, i.e. victims/witness assistance groups, Governors, religious groups, celebrities in many areas, etc.

It encourages bad behavior. Does not teach anything. Allows the teaching of the political agenda colleges drive into young minds to continue. That is the major reason politicians want the loans forgiven. It encourages current students to borrow more as they will believe they will never have to repay the loans. And it slaps all of us who paid off our loans right in the face.

College bound students should have been able to take out those loans at the same rate banks get to borrow money. Extremely profitable Corporations get tons our tax dollars, while paying no taxes and actually getting money back. The Federal Flood Insurance program is $25+ billion in the hole. Guess who will have to pay that down? I paid my own way through college, no help from my parents. However, back then, college wasn't as costly as it is today. I also started a business back in 1982. My loan rate was an immoral 20%, and I was able to pay it off ahead of time. Perhaps the answer is to allow these kids to refinance at the same rate banks pay for loans, with the stipulation they stay with that bank for all of their banking needs, until their loans are paid off. Banks are cash cows for the owners.

Our 3 children have $500,000 plus each in student loans. All are still paying

Do they all have good careers as a result of the student loans ?

If you borrow money you should pay it back. Why is that becoming such a hard concept to understand?

Wow! $500,000... I suppose that is part of being in a capitalist economy. The universities can charge whatever people are willing to pay. It used to be in my native country only 4% of the population attended university/ higher education and it was almost free tuition. But entrance was based on ability. Degrees actually meant something.

These days it is practically expected that you get higher education or else! And then which prestigious institution.

My daughter wanted a top University and she earned a full scholarship which paid for her residence as well. I also studied on scholarship which not only paid tuition and residence but also my child care. So we graduated with no debts but we really worked hard for it.

My heart goes out for those who need to pay these very large student debts. But it still amazes me that everyone, now days, needs to go to college. The more percentage of the population who attend college the less the degree actually means. It is like athletics if anyone can play, how good can the team be?

Had a home loan, paid it off. Had a car loan, paid it off. Had a student loan, paid it off. That's what you do.

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:agree: Sounds like you did the same thing I did, WORKED for a living! You do know some people...... VOTE for a living? :oops:

College costs are too high and will continue to increase as long as student loans are easy to get. The loans should be harder to get, especially for degrees that do not provide the earning potential to pay off the loan. Also, more work/study degree programs should be available, so the student can earn money while they are getting a degree.

Also, I don't agree with those who say that not everyone should get a college degree. Anyone can earn a degree, regardless of intelligence, and it will be an asset for your entire life. Often, having a degree will enable you to get a job even if you don't know anything. I have seen many people, especially in the Government, earning huge incomes with little or no talent at all, just because they have a college degree.

All three had full rides, for undergrad. By the time you finish your residency, then your fellow into your field. Half a million plus is pretty common for specialized physicians. All are children happy with their field.

Our granddaughter, is in premed, full ride. We all have had the conversation about physicians debt starting a practice, and MALPRACTICE cost. Other physicians she has shadowed have had discussions with her.

At 3 she announced she wanted to be a doctor, while she reading X-rays with her grandpa, at the office. She asked for a grays anatomy for her 5 birthday.

She is going To be an Orthopedic Surgeon with eyes wide open.

Well, if everybody should have a college degree, then let’s just go to the store and buy the degree we like - sort of like a television set. The original idea of what is a university, does not apply. The degree means nothing anyways....

There is a common perception among some people that the applied degrees, those that are directly used for professions, like engineering, doctors etc where you get a good salary afterwards, are the more valuable ones. That the theoretical degrees or the pure arts and sciences such as philosophy, mathematics, history etc are less important or less valuable - yet the reason why we get a PhD (doctor of philosophy) is because that was the origin of the university; philosophy. It is the theorists that drive research and the future while the applied sciences are simply the tools that are developed as a result. The difference to me is like being able to develop theoretically the formulas on your own, as in calculus for example, as compared to simply being taught the formulas and applying them (like engineers do).

I agree, if it were possible. In our society, having a college degree creates an illusion of knowledge that may or may not exist. It has been that way for a long time. Many job openings require the applicants to have a degree, but many applicants, who have a degree, have no more knowledge or capability as those without a degree. This is very true with Government jobs, where many jobs require a degree, but don't require any knowledge, intelligence, or skills at all. So, I recommend that every young person spend 4 years and get a degree. It will be time well spent that will provide an asset to use for the rest of your life. After all, what are you going to do for 4 years after high school that will really be worth more than a college degree?

while I agree that students should be responsible for what they borrowed, I think the lending rates should have been less than what they were and I would support re-writing of the loans with low interest. After all, if we could give the big banks no interest bail outs during the recession, we should be able to help the students. Remember, tuition is about 200 times what it was when we went to college and I can remember that there was an interest free period after graduation when you could pay off the loan if you were able to save enough. It's graduate school that's killing the young kids....the private loans that they have to take to cover expenses have interest accruing immediately. Too often, we look at things thru the lens of what we went thru and think things are the same--they are not. A one bedroom one bath apartment in Orlando is $1300-- a lot to pay when you are in your first job.

So, taxpayers who don't have a degree at all should finance someone who wants to go to graduate school? I don't agree with that. You can work for a few years and then pay your own way to graduate school, or get a private loan. The current student loan debt is 1.6 trillion dollars. Way too much.

It took me, personally, a long time, decades, after earning many degrees, to learn the value of applied skills, and of those people who never went to college or university.

My eldest daughter studied under Dr Martin Seligman, The Father of positive psychology (sort of the equivalent of Sigmund Freud, considered The Father of negative psychology). Many years in university. The other daughter decided to work in welding, now works on airplane parts and she delights making wrought iron art. She never wanted to go to university. Yet it would be hard to say which daughter was more successful. Each kid followed her heart.

Would it have really been worth a very large student loan for the difference?

That sounds wonderful! I can relate a tiny bit, I had a very happy baby sitter when I was five. I asked her what made her so happy and she said because she was studying chemical engineering. I had no idea what it was but I decided from that moment on that’s what I was going to do....and I did. Only to find out, much later, that watching chemical interactions for hours in beakers was not really my thing. Lol. Of course your granddaughter choose the right path for herself.

My favorite consumer guru, Clark Howard, recommends that you should never borrow more money for a 4 year degree than you expect to earn as salary in your first year after graduation. And, you should never make a private loan for graduate school. I agree with his advice, but he is a real cheapskate.

Two members of our family decided against college, one even tried it. Both went to trade school and both now have a 6 figure income plus significant benefits. We still need contractors, plumbers, electricians etc. and their income can far exceed college grads. In addition, job placement is highest in the trades because we need their skills. Not everyone can be a lawyer or doctor. I believe that many kids go to college because their parents want them to, they think that's whats best for them and quickly become disillusioned when they can't get into the field of their degree.

I was lucky, my parents paid for my tuition so I paid it forward, and setup 529 funds for each of 3 grandchildren, as well as paying for most of my step sons college, still have the last grandchild to go. The 529 investments almost doubled from the initial investment to time of use. So far all of the grand children have taken on side jobs and summer jobs to keep any remaining loans as low as possible, very responsible.

Trade schools are fine, but the skills you learn can become obsolete with technology and robots. Also, you can only do physical labor for a certain period of time before you burn out or become too old to do the job. Plumbers and electricians can only make as much money as electrical and mechanical engineers if they own their own business, in which case, they are business people, not plumbers and electricians.

I think that a person values the effort they put into it. Also there is the concept of learned helplessness, when you do everything for a person they learn that they are helpless themselves. (This applies to government student loans too, I think.) Therefore, I encouraged each child to fight for what they wanted, thus the scholarship. Eldest had five universities bribing her to come. (I was standing in the background ready to help each child .... if needed. Neither needed it. But they were also headstrong and choose their own path.)

Since the Federal Government guarantees Student Loans colleges will continue to raise tuition without consequences. If the student does not honor the loan then the Government (aka us taxpayers) will. Sort of a hybrid Ponzi Scheme created in Washington by our lawmakers who by the way vote their own salary increases.

The Federal Government doesn't guarantee student loans, they make the loans. As understand it, banks are prohibited from making Government student loans anymore. They are loans made directly from the Federal Government, unless they are private loans between the student and the bank.

She fractured her wrist at age 5. ER orthopod told her it was broken in one place, she looked at the x-rays told him it was fractured 2 places. Took her x-rays to her grandpa’s office. She was right it was fractured in 2 places, one fracture was so near the growth plate, ER guy missed it, but she didn’t. ER Doc was one of 10 recommendations for Med school.:a040:

Not sure what your experience has been but working plumbers and electricians make more than most. If they work for themselves they control their destiny but if they work for someone else they are promoted and run projects. Both of our family members did that, started at the bottom and worked their way up the ladder. Our son, no college degree, makes 125K a year and has been in his trade for 15 years, our nephew makes 110K a year and gradutated trade school 5 years ago. It's been an old argument parents use to convince college is their future, but I see a lot of graduates waiting tables, driving Uber or working at Disney. My point is that you don't need college to find a good paying job....that's a myth.

Student loans are far from a singular problem and people looking to get help with paying for them are far from alone. Have you heard or seen the dozens of ads for companies wanting to help reduce credit card debt through negotiation and consolidation? Have you seen the ads for companies that claim they have negotiated with the IRS to reduce people’s tax liens by tens of thousands of dollars? Not to mention the dozens of attorneys advertising for bankruptcy cases. Seems to me that many, if not most, people are looking to get out of debt without simply paying it off.

does not the interest rates depend on the likelihood of default? , if banks could not adjust for that could they stay in business ?

Yes, that is why the typical student loan is a direct loan from the Federal Government. Banks are not involved. Nobody cares if the borrower defaults because it is just taxpayer money, and the Government can raise taxes or borrow more money and increase the national debt. The current student loan debt is 1.6 trillion dollars and growing every day.

Getting a teaching degree is expensive but in some states you don't make minimum wage for teaching and you have to pay for all your own classroom supplies. This is breaking down how many hours you actually work, in the classroom and home grading papers, attending mandatory parent-teacher meetings, taking courses to maintain your status as a qualified teacher in your state, etc. etc. You can't just up and move to another state that pays better, those positions are already filled and there are waiting lists.

They didn't tell you all this when you decided to become a teacher. So now you can't pay the loan and your rent is late, you have no savings, you work another job to handle as many responsibilities as you can.

There are other careers in the same situation. Lots of kids went to college at the middle of the dot-com boom expecting a promised job in the tech trade. Four years later, the industry tanked and all these college graduates were out of work, and owing thousands.

Even some kids went to college to get a degree in agricultural studies to run the family farm. They graduated just two, three, or four years ago. And now there's a trade war and they will lose their farm - and have to pay back the loans.

No fault of the kids, has nothing to do with being cheap. They did the right thing, borrowed only as much as they expected to earn in their first year just like Clark Howard recommends. Unfortunately society rejected their expectations and told them they were SOL, and they'd better pay up what they don't have or else.

I don't think debt forgiveness is the right answer unless it's to a school that was shut down for defrauding the students.

But I think kids should be able to get a break on the pressure of repaying that debt. Add a couple more years to their payoff date, at no additional interest rate. Let them skip their birthday month's payment. Allow more generous deferments.

I worked in student loans. I’ve been retired 12 years and haven’t kept upon the changes. There is so much miss information in these post I don’t even know where to begin plus I don’t want to argue.

I agree with you 100% . I was a senior exec at a large Regional Bank . One of the Business Lines that reported to me back when we did" Direct Student Lending" was the Federal Student Loan Program .

There is a lot more to the entire program than what has been discussed here . Like anything there is a great deal more to the entire issue .
Loans to students attending so called " Trade Schools " such a Cosmetology and Secretarial Business Schools had horrendous Default Rates . As high as 80% !
Yet for many years we were forced to process and advance loans to these students or it was considered Discriminatory . Not Discriminatory against the student but possibly as Discrimination toward the " School " . We also had to work hard at great expense to collect payments before we could declare a loan to be " Uncollectible " and turn it over to the Federal Government to exercise their Guarantee. Something like one year of zero payments . And on and on .
My Bank and many others put pressure on our Federal Representatives to institute some standards such as student graduation rates , ability to pass State Licensing Exams , Historic Loan Default Rates etc .
The result was the Federal Government simply took over the Student Loan process and took over the Student Loan portfolios from all Banks .
Apparently this was their answer to serious problems in the National Student Loan Program . This was many years ago however I must wonder if the standards were ever cleaned up .
" For Profit Schools " are major abusers of the system . You see them running Ads on TV every day .They put on hard recruiting practices to gather students , many who should not be in college or even Trade Schools . They have them borrow the max allowed which goes to those who own the schools and very few ever get a useful education .
Most are left with broken dreams and a huge debt .
Most people who attend legitimate Universities and Colleges and who Majored in anything close to useful eventually are able to build successful careers . Some sooner than others but the vast majority do .
Note : Back when Banks administered the loans it was The Federal Government who determined what interest rate banks could charge on student loans under that program. Also the abusive " school " operators donate a lot of money to their favorite politicians in order to keep their game going .

First, be aware, the misinformation you speak of is the norm on this forum.

There actually is a group that openly hates facts.

Good news, FACTUALLY student loan default is down, and has been trending that way for some time. Hope that is correct information.

Student Loan Default Rate Continues to Decline


Problem, in my opinion is those loans taken in the past were great BUT what you can earn has not kept up with the cost of college costs.

Most don't think of debt as a bad thing (see US government), and I just read recently the default on car loans dwarfs default on college loans.

I don't think it is appropriate to compare car loans to student loans. Car loans are private loans made by financial institutions and they are for profit, collateralized loans. Student loans do not have any any collateral, and, when they default, the taxpayer loses, not a financial institution. The total car loan debt is about 1.25 trillion dollars as compared to the student loan debt of 1.6 trillion dollars. But, I don't think the companies making car loans are losing money. The taxpayers making student loans are losing plenty of money because, from a financial standpoint, most of them are bad loans. This is an apples to oranges comparison.

The disconnect between the cost of a good education and what one can earn is because education is not what it used to be. When we all went to college engineering, math, science, physics, business, law, and pre-med were degrees of choice. Now kids go to school for degrees in social justice, climate sustainability, and the like. It's no wonder they can't pay off their loans. And you are correct that car loans dwarf the defaults on college loans, that is because banks can reposess your car if you don't pay the loan, but they can't take back the time you spent in college if you default on your student debt. Collateral that can be taken back is definitely worth something to a lender.

When the graduate ends up in Section 8 housing, collecting welfare and SNAP benefits, and has their only form of transportation repossessed because they paid back their student loan and have nothing left . . .

it's the taxpayer who will be paying for that graduate's housing, welfare check, food stamps.

Do you really think a few years worth of all those things are less expensive to the taxpayer than the student loan? If you do, then there is something seriously wrong with the cost of higher education, because it shouldn't cost more than the cost of housing, food, utilities, clothing, and transportation for a few years.

If you don't think those things are less expensive, then you probably would prefer to risk being the taxpayer who pays for the defaulted loan, than for the graduate's expenses as a result of not finding a job in the career their education was supposed to prepare them for.

Liberal arts degrees were hugely popular in the 1960's, 1970's, and 1980's. Political science was also very popular.

College tuition in the 1960's was usually less than $2000 per year. 4 years at Harvard was less than $35,000 total, including room and board for the first two years. Now it's around $130,000 PER YEAR. The cost of education has gone up MUCH higher than the salaries people expect to get as a result of that education. And much higher than the overall rate of inflation.

That is why student loans are being defaulted. Older people are remembering how easy it was for them to get their own loans and pay them back, and not noticing how expensive it is for kids to get the same education now. "Back in my day" is obsolete, and irrelevant.

This is partly because of the push to get too many people who shouldn’t be at college there in the first place. There is an imbalance. The demand and the supply do not meet.

So the kid with the PhD in philosophy ends up becoming a fisherman, my friend did. But then he didn’t study in order to make money or serve society, he studied because the subject interested him. But who is going to pay for his student loan? For his fun time at university?