http://www.cnbc.com/id/100598257

In my personal opinion, the government should take over all student loan funding, and drop the rates to say 1%. And only allow the loans to cover degrees in practical areas.... Nursing, doctors, automotive mechanics, not any kind of philosophy stuff, or whatnot.

I just read the majority of student loans go un paid...
stick it to the tax payer,

im in diesel classes and finish my degree in may. i have 10k in student loans and i start paying them in august. im greatful for those loans because they helped me pay for little expenses and such. its pathetic to think people would willingly not pay them if they could afford it.

Hello, from what I understand you can Not hide from a student loan that has been underwritten by the Fed as you canNot bankrupt the loan. Once you default it does not go away it gets rebundled with other bad debt loans to another bank at a higher interest rate that follows you that you cant get rid of. And you will keep paying on the interest and gets harder to pay off the principal, worse than a Pay Day Loan.

quote Originally posted by 1985FieroGT: http://www.cnbc.com/id/100598257 In my personal opinion, the government should take over all student loan funding, and drop the rates to say 1%. And only allow the loans to cover degrees in practical areas.... Nursing, doctors, automotive mechanics, not any kind of philosophy stuff, or whatnot.

Just what we need, more artificially decreased interest rates.

Student loan debts almost never are forgiven, even in bankruptcy. I graduated with $35k in student loan debt paying $365 a month, and the highest interest was on the federal loan @ 7%, the two private loans (guarenteed by the government, same protections as federal loans) were actually around 4%. And when nobody is hiring entry-level positions, most recent graduates can only get minimum wage work, making $1200 a month. Cost of rent around here is $800 a month on average. Just do the math.

My sister-in-law defaulted on her student loan, so the Fed just kept my brother's income tax return money to pay on the debt. Like it or not, they will get what is theirs, eventually.

[This message has been edited by Cooter (edited 03-27-2013).]

quote Originally posted by 1985FieroGT: In my personal opinion, the government should take over all student loan funding, and drop the rates to say 1%.

....... really?

Colleges, at least at the community level have become a huge welfare program where kids are warehoused. Loans given for living expenses are the only source of income for some students who are there only to make them eligible to receive the loans. Inmates freshly released from correctional units are given vouchers to attend some schools. There is no way many of these loans will ever be repaid.

These are loans that never should have existed. The financial institutions lobbied to get governments to back the risky loans or they never would have been granted. It would have been far cheaper for the governments to fund colleges directly than agree to cover the loan shark's income loss. One trillion dollars in student debt at the moment.

quote Originally posted by spark1: Colleges, at least at the community level have become a huge welfare program where kids are warehoused. Loans given for living expenses are the only source of income for some students who are there only to make them eligible to receive the loans. Inmates freshly released from correctional units are given vouchers to attend some schools. There is no way many of these loans will ever be repaid. These are loans that never should have existed. The financial institutions lobbied to get governments to back the risky loans or they never would have been granted. It would have been far cheaper for the governments to fund colleges directly than agree to cover the loan shark's income loss. One trillion dollars in student debt at the moment.

Good post.

quote Originally posted by Cooter: My sister-in-law defaulted on her student loan, so the Fed just kept my brother's income tax return money to pay on the debt. Like it or not, they will get what is theirs, eventually.

Thats ONE thing I am very glad we dont have up here....that "guilt by association" attitude that you are responsible for somebody else's debts. Up here, in that example--they could seize the sis-in-laws tax return but that's ALL . NOBODY else's (unless they were co-signers)....and you guys can KEEP your philosophy on that one !!!

[This message has been edited by MidEngineManiac (edited 03-28-2013).]

There isn't enough truth in the world. We tell ourselves that we can be anything we want to be then we run off into dream world without a clue what it takes to get to the moon.
When I was going to school all I heard was how much money everyone was going to make. I was the only one in the class having fun and excelling at it. Heck there were students that had never turned on a computer before.
Two months after graduation and I am the only one that is working in my field, why because I took an entry level job that was not good enough for everyone else.
2 years later none of my "friends" are working in the field. I have no idea what any of them are doing now.

Loans should be hard to get, they need to make sure there will be a return on the investment. If there is room to fail then you will have failure.
The loan application should be as hard to fill out as the last test you take to get your degree and you should have to get an A on it.

Stop using my ****ing money to pay off failures and make people responsible.

[This message has been edited by Jake_Dragon (edited 03-28-2013).]

Hmmm, I don't know of anyone who defaulted on their student loans, but maybe it is who I interact with. The money has been well spent and repaid with interest.

Student loans are necessary and money well spent (for the majority).

quote Originally posted by spark1: Colleges, at least at the community level have become a huge welfare program where kids are warehoused. Loans given for living expenses are the only source of income for some students who are there only to make them eligible to receive the loans. Inmates freshly released from correctional units are given vouchers to attend some schools. There is no way many of these loans will ever be repaid. These are loans that never should have existed. The financial institutions lobbied to get governments to back the risky loans or they never would have been granted. It would have been far cheaper for the governments to fund colleges directly than agree to cover the loan shark's income loss. One trillion dollars in student debt at the moment.

I know that there are "students" who take the loans and use the money as their living expenses, fail to maintain a decent GPA, and the schools just take the "free" money and the students just obtain another loan. In many instances the student loans have become another welfare program for some. The taxpayers will end up paying for it.

quote Originally posted by Old Lar: and the schools just take the "free" money and the students just obtain another loan.

Why is the school blamed, they are not responsible for the student's actions.

The borrower is always always always responsible for his/her actions in regards to student loans or any other kind of debt--not the lender or the person providing the service or goods the loan funds. The debtor signed--willingly and freely on the dotted line and agreed to the terms--ALL the terms.. There were no guns held to anyone's head.

Re-institute debtor's prisons, and make them work it off on the side of the roadways..

[This message has been edited by maryjane (edited 03-28-2013).]

FYI...

Loan default is the failure to make loan payments when they are due, and default usually occurs when the borrower fails to make a payment in 270 days. The consequences of defaulting on student loans can be very serious and long lasting. When you default on your student loans:

Your entire loan balances becomes due in full – no repayment plans.
You lose any eligibility for deferment or forbearance.
You are reported to the credit bureaus. Your credit score and future borrowing ability is negatively impacted.
Your loan balance increases due to new collection costs.
You are ineligible for future federal aid should you want to return to school.
Your wages, tax refunds and Social Security payments can be confiscated by the government until your loans are paid off in full.
Your lender can turn to private debt collectors to uncover unpaid student loans.
You can be sued.
Your student loans can’t be discharged for bankruptcy, unlike credit card debts and other loans

http://www.nerdwallet.com/b...fault-student-loans/

quote Originally posted by jaskispyder: Hmmm, I don't know of anyone who defaulted on their student loans, but maybe it is who I interact with. The money has been well spent and repaid with interest. Student loans are necessary and money well spent (for the majority).

If by "Majority" you mean "Majority of students in STEM fields," then yes they can be good investments. Outside of STEM or practical skills (vocational training), they're just a rope to fiscally hang yourself with.

quote Originally posted by theBDub: ....... really?

The purpose is so that it's not charging usury... it'll make the payments manageable. The point of the loan shouldn't be to make money off the person, but to get them educated.

Or do our educational system like Germany... where you have the students go into either a high school meant to go towards working a trade eventually, or a high school meant for college prep... then have college become state ran and funded up to a four year degree. Heck you could potentially have it funded all the way to Ph.D. levels...

Just like the mortgage and housing bubble, so goes (or will go) with student loans and tuition.

Easy to get mortgages resulted in huge rises in house prices, far beyond their worth, and when enough people couldn't pay, it killed the market (thank you Fed Gov for that

Easy to get student loans have resulted in tuition skyrocketing, and what we are beginning to see is some realization that graduating with an art degree and 150k of debt isn't exactly a smart thing, since there's not much chance at landing a job drawing 'gumby' for much beyond minimum wage.

I'm not entirely sure that college is needed, except for -certain- professions. Like 'doctor' or 'lawyer'. And even that is iffy, except that the State requires it. A properly motivated individual could likely bypass college and pass the BAR or Med Board tests, if it were allowed...

quote Originally posted by dsnover: Just like the mortgage and housing bubble, so goes (or will go) with student loans and tuition. Easy to get mortgages resulted in huge rises in house prices, far beyond their worth, and when enough people couldn't pay, it killed the market (thank you Fed Gov for that Easy to get student loans have resulted in tuition skyrocketing, and what we are beginning to see is some realization that graduating with an art degree and 150k of debt isn't exactly a smart thing, since there's not much chance at landing a job drawing 'gumby' for much beyond minimum wage. I'm not entirely sure that college is needed, except for -certain- professions. Like 'doctor' or 'lawyer'. And even that is iffy, except that the State requires it. A properly motivated individual could likely bypass college and pass the BAR or Med Board tests, if it were allowed...

What is happening in places like Michigan, is that the state cut funding over many years for colleges/universities, which means tuition goes up to offset the loss of revenue (and general budget increases), then students must borrow money, which increases the number and amount of loans.

quote Originally posted by 1985FieroGT: http://www.cnbc.com/id/100598257 In my personal opinion, the government should take over all student loan funding, and drop the rates to say 1%. And only allow the loans to cover degrees in practical areas.... Nursing, doctors, automotive mechanics, not any kind of philosophy stuff, or whatnot.

I could not disagree with this more. The reason why student loans are so out of control is because of the government interference. This is an another case of the tax payers are on the hook for private sector gambles.

Lenders are willing to give money to any student for any degree regardless of grades or possible post graduation earnings. They know that no matter what happens, their money is safe since the tax payers will cover any defaults. As a direct result of all of the easy money available, colleges have increased their tuitions to get as much money as they can. The college student that are taking these loans have very little understanding of the debt they are taking.

Does any of this sound familiar? It should. It is the exact same thing that happened with the housing bubble just before it burst.

If you want to fix college tuitions and debt, then the government needs to get out of the student loan business. When lenders have to take the loss for their reckless behavior, they will be more careful with their lending. When the easy money for colleges goes away, colleges will have to adjust by lowering tuitions and sticking to core curriculum. This will mean many degree mills will close. It will also mean that college bound students will have to meet more lending requirements such as good grades and taking degree programs that are actually in demand in the job market.

quote Originally posted by Doug85GT: As a direct result of all of the easy money available, colleges have increased their tuitions to get as much money as they can.

As already stated, this is not correct for some areas. Cuts in funding by the state, and increase expenses have caused tuition prices to increase.

As for curriculum changes, accredited colleges/universities must follow the rules set forth by the accrediting body (ie.. colleges/universities don't just make up the curriculum based on what they can most money on).

Community colleges are supported by local communities (taxes) and when revenue is down, more people tend to look towards increasing their education, which puts more cost on the college (tuition increases)... which happens to colleges and universities.

Not everyone needs a college education, but I believe even a degree in "art history" can be financially beneficial to the right person, or group of people that person may employ in the future.

Yes, state colleges have had to increase their tuition since tax revenue has dried up. That just means the tax payer subsidy has been reduced. We don't know the real cost of those degrees. I am not sympathetic to state run tax payer subsidized colleges. It is a government luxury item that should be cut when funding becomes tight.

We can see the real price of tuition from private colleges. They have gone up 60% in the past ten years for the non-profit colleges.



Notice how the recession reduced income for the average American but tuitions still continued to rise. When tuition ignores market factors that tells me it is out of control.

quote Originally posted by Doug85GT: It is a government luxury item that should be cut when funding becomes tight.

America spends more on defense/military than education.

quote Originally posted by jaskispyder: America spends more on defense/military than education.

So? Provide for the common defense is a government function that is explicitly declared in the Constitution. Provide cheap college tuition is not.

quote Originally posted by jaskispyder: America spends more on defense/military than education.

Is that a bad thing? I think other than K through 12 the tax payers should not be footing the bill at all.... period.

quote Originally posted by Red88FF: ...other than K through 12...

Why make the exception?

quote Originally posted by Doug85GT: So? Provide for the common defense is a government function that is explicitly declared in the Constitution. Provide cheap college tuition is not.

$88K an hour to fly a B2 (2011 stats).... good thing we have the luxury of flying them around South Korea.

Who ever said to just walk away. Good luck. My GF is getting her paychecks garnished cause she got behind.

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Michael Geddie Photography

quote Originally posted by Red88FF: Is that a bad thing? I think other than K through 12 the tax payers should not be footing the bill at all.... period.

Any "we" wonder why all the good paying jobs are going overseas....

quote Originally posted by RWDPLZ: Student loan debts almost never are forgiven, even in bankruptcy. I graduated with $35k in student loan debt paying $365 a month, and the highest interest was on the federal loan @ 7%, the two private loans (guarenteed by the government, same protections as federal loans) were actually around 4%. And when nobody is hiring entry-level positions, most recent graduates can only get minimum wage work, making $1200 a month. Cost of rent around here is $800 a month on average. Just do the math.

And there ya go. Its what ive said for year usually happens.

Personally, I dont think the government should be in the loan business at all. Colleges are overcrowded with people who just go to party and have no real desire for an education in a selected field of future employment. Either pay your own way as you go, go to a bank or loan company on your own, or get parents to pay for it. Everyone who graduates high school doesnt just earn a right to college. Its that simple...if you cant afford it, dont go. Everyone would love a Ferrari or Lambo too, but most end up with Hondas and Kias.

If you need assistance from the government, you should be required to earn it by military service or some public service.

I also think parents of kids should be footing the bill for K-12 grade too. Why do I pay for that thru property tax when I havent had a kid in 45 years. Maybe if parents had to pay for the schooling, they would reconsider having them and if they do, they would be more responsible for those kids. Right now school thru 12th grade is just a government paid babysitter.

[This message has been edited by rogergarrison (edited 03-28-2013).]

quote Originally posted by jaskispyder: $88K an hour to fly a B2 (2011 stats).... good thing we have the luxury of flying them around South Korea.

Go ask your buddy Obama why he did that.

quote Originally posted by Doug85GT: Go ask your buddy Obama why he did that.

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quote Originally posted by 1985FieroGT: The purpose is so that it's not charging usury... it'll make the payments manageable. The point of the loan shouldn't be to make money off the person, but to get them educated. Or do our educational system like Germany... where you have the students go into either a high school meant to go towards working a trade eventually, or a high school meant for college prep... then have college become state ran and funded up to a four year degree. Heck you could potentially have it funded all the way to Ph.D. levels...

Look into what caused the housing crisis. Then tell me you want to do what you said.

Everything should be private. From Kindergarten to doctorate. Germany's system works for Germany but it has a lot of flaws.

It is wrong to force me or anyone else to pay for another's education.

I don't understand why people can't afford their loans. I graduated in December. I'm not thrilled about high my loans are but its about the equal amount of a nice car. So you know what I do? I just don't get a nice car. I've paid off all my other debt, and I start paying on them later this year. I'm planning on buying another vehicle, probably about a 13k vehicle. But it will also be used as a work vehicle for my business, IF I did need it for work, I'd buy something much cheaper.

There are a handful of repayment options as well.

What am I missing here? I had my job (in my field) before I graduated, they found me. I was lucky here but I wouldn't of got a degree in something that didn't have the potential to pay six digits for how much loan money I took out. Do people really expect that a degree in Roman History will pay off there 60k in loans?

How much was your debt? Some don't have a lot, others on the other hand..........

quote Originally posted by Fosgatecavy98: I don't understand why people can't afford their loans. I graduated in December. I'm not thrilled about high my loans are but its about the equal amount of a nice car. So you know what I do? I just don't get a nice car. I've paid off all my other debt, and I start paying on them later this year. I'm planning on buying another vehicle, probably about a 13k vehicle. But it will also be used as a work vehicle for my business, IF I did need it for work, I'd buy something much cheaper. There are a handful of repayment options as well. What am I missing here? I had my job (in my field) before I graduated, they found me. I was lucky here but I wouldn't of got a degree in something that didn't have the potential to pay six digits for how much loan money I took out. Do people really expect that a degree in Roman History will pay off there 60k in loans?

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Michael Geddie Photography

I work at an art college. Fine art has an abysmal rate of loan repayment. Graphic Design, Game Design, etc. are all a lot better.
We're constantly seeing petitions around campus for people to sign, in favor of the Gov't discharging all debt. I think, realistically, get rid of student loans. That'll force educational institutions to compete on price like every other business does. Pre-college counseling to help people select a major that'll have a chance of paying off the loan one day. Leave liberal arts degrees for the rich kids, or the people that saved up for it, as otherwise it's never getting paid off. If taking out an educational loan, pre-loan counseling so people see "here's the path you've chosen, this is how long it'll take to pay off, and here's the chances you have of actually getting a job with your degree". Most of the fine art grads just wind up working here for lack of any real jobs for them to go into. On the flip side, we're a private nonprofit school and its getting *really* expensive to keep up with laws and regulations governing intellectual property, data protection, security, electronic surveillance, etc. I think a back to basics approach, wherein students get assistance *before* signing anything, to help them understand what they're headed into, and help them see the long term ramifications of what they're doing. I personally don't value a fine art degree at all - how many famous artists had degrees? Just take some community college classes. Get the degree if you want to be an art teacher, but that's about all its good for.

quote Originally posted by rogergarrison: I also think parents of kids should be footing the bill for K-12 grade too. Why do I pay for that thru property tax when I havent had a kid in 45 years. Maybe if parents had to pay for the schooling, they would reconsider having them and if they do, they would be more responsible for those kids. Right now school thru 12th grade is just a government paid babysitter.

Great plan. We can replace all the unborn kids with immigrant kids.