Forgiving Student Loans

[roguemocha]

This is a hot topic right now and thought I'd see what the majority thinks. IMO, forgiving student loan for everyone means my parents should get paid back for paying for my education up front. I mean, just because they could afford it doesn't make it "fair" that EVERYONE who can't gets theirs for free. And who is going to pay for all this forgiven debt?

To me, it's the same as someone saying, "I spent too much on my credit card and now I can't pay more than the interest off so it should be forgiven." Or, "I signed up for the military to get a free education, now they want me to go overseas and fight and I don't want to do that I just wanted the free part."

You can't agree to taking the good part of a loan, deal, etc, and then cry unfair once it's time for you to pony up your end of the deal. That being said, I don't want people to be stuck paying their loans forever but I don't think they should just be relinquished of their part of the debt.

 

[W2R]

This is a slippery slope. When I first went to school my parents made too much money for grants and assistance

First off my dad was electrician and step mom was a secretary. Not like they we pulling in the big bucks. I had to establish residency of my own and it had to be for a certain amount time before I could get grants and student loans in my name.
I have paid on them consistently for years now I'm not asking for a handout or be forgiven.
I'm am glad your parents were able to afford your education, my parents were not. My dad had to take early retirement and my stepmom works her butt off. My real mom passed away five months after I was married If any of them would have taken on my financial burden, they wouldn't have been able to make it. Pell grants and others don't put a dent in the cost

I'm just trying to give you different scenarios.

 

[roguemocha]

I realize there are different situations, but it's so hard to differentiate between those who really need it and those who got them because they could. I have a buddy whose brother bought a motorcycle with his loan because he didn't really need it but it was a better rate than the bank could give him.

 

[roguemocha]

Also, who pays this back? Where does the money come from? Or do the loaning institutions just get screwed?

 

[W2R]

Also, who pays this back? Where does the money come from? Or do the loaning institutions just get screwed?

All good questions.

 

[PTI (pti)]

Obama already said he wants to lower the interest rates on these loans. So, to the 27 year old barista with a masters in underwater basket weaving and $197,000 in debt, congrats and saving $14/week in interest.

What more do you want??

 

[UKGrad93]

Stop making student loans easy to get. Find a way to grade the persons ability to pay them back (risk). Engineering or nursing major with a high gpa, congrats, you move to the top of the list. Fine arts major, you'd better have your rich parents co-sign.

 

[BigBlueSean]

I don't have a problem with paying back student loans that are reasonable...but the big business of "college" has made it unreasonable. You have colleges making you take alegra friggin one and charging $400 a credit hour so they can simply make $1200. For the first year student loan debt has surpassed credit card debt as the #1/source of debt. The average student now goes $35,000 in debt to make $29,000 a year... Also it's a ripoff that the loans are originally received for interest rates well below 1% and then sometimes quadroupled, if not more when the student has to pay them back. Everyone is benefiting but the student. I have a buddy that went to law school and them had to file bankruptcy due to student loans...that's bullshit. I think you should be required to pay back 50-60% of the loans at the same interest rate they are taken originally from...

 

[BigBlueSean]

And college as a whole needs to be adjusted.... It's an absolute ripoff ....from tuition to room and board to books.

 

[jamo0001]

there are so many different loan forgiveness programs that tackling your questions is almost impossible. I'm using a program right now and I can tell you with 100% certainty this program incentivized me to work at my current job instead of a much more lucrative one. The idea is that these programs save the tax payers money in the long run since it can help reduce the wage pressure on necessary but unattractive jobs the tax payers *have* to have filled. Either pay those workers more on the back end in order to compete w the private sector or pay them more on the front end with cheaper education/loan costs so that they don't have such an incentive to flee for the private sector right away.



That being said, the nation as a whole has a vested interest in keeping education costs as low as possible while keeping the seats within various tracks as competitive as possible. You don't want a system where all of your engineers are selected based on whether their parents are rich rather than on whether they're the best and brightest.

 

[domino79]

Pretty sure you can't file bankruptcy over student loans.

 

[BigBlueSean]

Pretty sure you can't file bankruptcy over student loans.

He didn't file for student loans, all the extra expenses for books etc.. He had to file for that so he could afford to make payments on his student loans

 

[BigBlueSean]

The forgiveness programs are a joke, to qualify there are soo many stipulations. People like to tout the working in public service field...yeah I looked into that and I reported my first 32,000 a year state job and they told me I had to make a near $500/a month for x amount of time and then the rest would be forgiven.... Yeah, OK....that ain't happening on that salary...

 

[roguemocha]

Obama already said he wants to lower the interest rates on these loans. So, to the 27 year old barista with a masters in underwater basket weaving and $197,000 in debt, congrats and saving $14/week in interest.

What more do you want??

This is exactly my point. The people that are screaming bloody murder about this are mostly liberal arts majors and people that aren't using the degree they borrowed for because, well, they picked a useless degree and now they want their money back.

 

[DaBossIsBack]

Also, who pays this back? Where does the money come from? Or do the loaning institutions just get screwed?

Hopefully.

 

[DaBossIsBack]

This is exactly my point. The people that are screaming bloody murder about this are mostly liberal arts majors and people that aren't using the degree they borrowed for because, well, they picked a useless degree and now they want their money back.

You got some numbers to back this claim up?

 

[W2R]

Grants / loans haven't kept up with the massive increases in tuition and costs. Too lazy to look up , but I know colleges have increased tuition substantially since early 90s. How much of an increase in grants since then ?

Not everyone is gifted with superior academic success , athletic talent, or parents that can afford to pay. Most people are none of these. There needs to be a better system for all.

 

[Bill Cosby]

Would have loved to get a tax LLM. But the cost of foregoing employment and having to pay for the school outweighed the benefit.

So yeah, hopefully we can now find a way for my tax dollars to be used to pay for the schooling of the people who decided to pursue their dreams without ever stopping to think how stupid it was to borrow all that money.

And hopefully everyone who worked their way through college rather than partying and borrowing money understands they're really just doing their part to help.

 

[jockstrap_mcgee]

Undergrad, no.
Grad school for needed professions like teachers. Yes.

 

[KingOfBBN]

My take on this topic.

1.) No freaking way should student loans be forgiven unless they're going to reimburse all of us who paid our loans off.
2.) Maybe, stop giving student loans out on useless majors where it's impossible to pay back? A bank doesn't usually give out massive loans to someone with a terrible business plan
3.) Yes, do something about the insane cost of tuition. Here are a few suggestions for this...get rid of athletics because the majority of them are in the red (MASSIVELY IN THE RED) and students end up paying a huge chunk of the cost, which was the case at my university. Get rid of bloated administrations and huge six figure salaries.
Maybe you don't need that new fancy building? Maybe you don't need that new arena? Maybe you don't need all of these useless classes and the useless teachers to teach them

I'm all about making college about education again (pipe dream) instead of focusing on BS like athletics and an "experience."

 

[PTI (pti)]

College doesn't have to be so gd expensive. Start at community college, finish up at the state school. In Kentucky, that's something like $25,000 for a 4-year degree.

Work your ass off in the summer and 25+ hours/week at a good college job (restaurant/babysit/cut grass/uber/etc), live in a dirt cheap apartment, buy used books online, take advantage of scholarships and pell grants....

The student loan nonsense has just perpetuated the terrible decision making of teenagers. Shameful. End the entire student loan program, imo. Peoples lives are being ruined by this failed experiment.

 

[jamo0001]

College doesn't have to be so gd expensive. Start at community college, finish up at the state school. In Kentucky, that's something like $25,000 for a 4-year degree.

Work your ass off in the summer and 25+ hours/week at a good college job (restaurant/babysit/cut grass/uber/etc), live in a dirt cheap apartment, buy used books online, take advantage of scholarships and pell grants....

The student loan nonsense has just perpetuated the terrible decision making of teenagers. Shameful. End the entire student loan program, imo. Peoples lives are being ruined by this failed experiment.

Agreed (to a large degree, at least). No bank would give a 300k mortgage to an 18yr old without any foreseeable income.

So yeah, hopefully we can now find a way for my tax dollars to be used to pay for the schooling of the people who decided to pursue their dreams without ever stopping to think how stupid it was to borrow all that money.

in a narrow sense, sure. with an eye to the future, though, that's not the way you facilitate a developed economy. If everybody had to pay cash for any sort of education, we'd never have enough engineers, architects, doctors, teachers, etc.

tax payers have a vested interest in making sure those positions get filled with the best minds. the question is how to go about doing that without throwing a ton of unsecured loans at people who can never pay them back.

 

[ukalumni00]

College doesn't have to be so gd expensive. Start at community college, finish up at the state school. In Kentucky, that's something like $25,000 for a 4-year degree.

Work your ass off in the summer and 25+ hours/week at a good college job (restaurant/babysit/cut grass/uber/etc), live in a dirt cheap apartment, buy used books online, take advantage of scholarships and pell grants....

The student loan nonsense has just perpetuated the terrible decision making of teenagers. Shameful. End the entire student loan program, imo. Peoples lives are being ruined by this failed experiment.

Absolutely agree and is what I had to do to put myself through college. We can argue all day the reasons why the loan crisis has gotten to where it is at how, but unless you are getting a scholarship to go to an expensive school or have loaded parents, it makes zero sense to go to an expensive 4 year university straight out of HS. Get your basics out of the way the first 2 years at a community college which allows you some time to either make sure or figure out what you want to major in and then go to whatever university you want the degree from the last 2 years. I will be the first to admit I am thankful I graduated from UK before tuition skyrocketed but I still had to be very disciplined to get out with minimal debt.

 

[Kennedy_UK]

^^^ "Terrible decision making of teenagers." Yes; that's valid. Too many kids are recklessly taking out loans to avoid having to make a decision about their future. But irresponsible teenagers isn't really the problem. It's the policy that permits schools to establish the maximum amount a student can borrow from year to year.

Which brings me to the Graduate PLUS Loan. Under that program, the only cap to the amount a student can borrow for a post-graduate degree is based on the total cost of attendance ---- established unilaterally by the school. Basically, the Graduate PLUS Loan is a federally-funded open check for graduate schools (both private and public institutions). For example, I went to law school in 2007-2010 (i.e., when the economy caked its pants). During that time, my law school raised tuition all 3 years --- and each year, the cap on the Graduate PLUS Loan raised to match. And during the summer between my 2L and 3L years, the school decided to spend $$$ to remodel the GD lobby with marble, flat screen TVs, etc. So not only were students from my law school languishing without jobs (after raking in $225k of student debt), but the school decided it was a prudent investment to spend a few million under the ruse that a state-of-the-art lobby makes the school more competitive to prospective students.

People wonder why education (particularly post-graduate programs) are so expensive. You need not look any further than the fact that the federal government subsidizes their largess. There is absolutely no incentive for these schools to cut costs, become more economical, or otherwise reign in the tuition passed on to the student.

 

[Hankshaker]

If there wasn't a federal guarantee, that bubble would have burst a long time ago. I, honestly, think that would be a good thing for most people.

 

[LadyCat92]

College doesn't have to be so gd expensive. Start at community college, finish up at the state school. In Kentucky, that's something like $25,000 for a 4-year degree.

Work your ass off in the summer and 25+ hours/week at a good college job (restaurant/babysit/cut grass/uber/etc), live in a dirt cheap apartment, buy used books online, take advantage of scholarships and pell grants....

The student loan nonsense has just perpetuated the terrible decision making of teenagers. Shameful. End the entire student loan program, imo. Peoples lives are being ruined by this failed experiment.

Essentially this. I took out the trash and worked at Wal-Mart for 2 years until I got a co-op which paid considerably more for the semesters I was at it vs. school. Even then, I lived in a cheap apartment and stashed money away so that I could fully pay for school the following semester and even when I came back, I would find a small job that I could get 20-25 hours in so that I had spending money. I had about $5K in loans just because my parents had no way to help me but that was over 4 years. Plus, you don't need every damn thing in college. Eat ramen noodles, get the student special from the local pizza place and either split it with friends or make it last, drink cheap beer, etc.

Part of the problem is that back in the 90s, basically you had Stafford Loans which had 2 kinds and you either qualified for those or you didn't. Now there seems to be every possible way to take out a student loan and parents seem to be signing for them without questioning. The other big rip off is that if schools require frosh/soph to live on campus and have a meal plan. The cost of dorms and meal plans used to be outrageous compared to tuition. Not sure if that is still the case, but that used to be the biggest cost.

 

[80 Proof]

Too many fools who have no business going to college are going to college. We need more people with knowledge of skilled trades in our country, from carpenters to computer techs. I've never seen a job description looking for a philosophy major.

 

[Rex Kwon Do]

No bank would give a 300k mortgage to an 18yr old without any foreseeable income.

Exactly.

I mean, when you put it as simply as this and take a birds eye view it just seems so absurd. It's ties in well with the notion a pricey degree ensures your right to make a ton of money right out of college.

Aside from inherited family assets, actually making a lot of money is *really* hard. Even harder with no drive and a Psych degree.

 

[W2R]

College doesn't have to be so gd expensive. Start at community college, finish up at the state school. In Kentucky, that's something like $25,000 for a 4-year degree.

Work your ass off in the summer and 25+ hours/week at a good college job (restaurant/babysit/cut grass/uber/etc), live in a dirt cheap apartment, buy used books online, take advantage of scholarships and pell grants....

The student loan nonsense has just perpetuated the terrible decision making of teenagers. Shameful. End the entire student loan program, imo. Peoples lives are being ruined by this failed experiment.

Some people actually hurt themselves by going to community college to knock out basic courses. When they arrive at four year school some credits don't transfer and also they are taking freshman classes for their field of study as juniors. In the end being in school
Longer

 

[roguemocha]

Should probably look into transferring to a school where they will count like the BCTC/UK setup.

 

[crazyqx83]

This is a hot topic right now and thought I'd see what the majority thinks. IMO, forgiving student loan for everyone means my parents should get paid back for paying for my education up front. I mean, just because they could afford it doesn't make it "fair" that EVERYONE who can't gets theirs for free. And who is going to pay for all this forgiven debt?

To me, it's the same as someone saying, "I spent too much on my credit card and now I can't pay more than the interest off so it should be forgiven." Or, "I signed up for the military to get a free education, now they want me to go overseas and fight and I don't want to do that I just wanted the free part."

You can't agree to taking the good part of a loan, deal, etc, and then cry unfair once it's time for you to pony up your end of the deal. That being said, I don't want people to be stuck paying their loans forever but I don't think they should just be relinquished of their part of the debt.

I don't believe in forgivessness but there is no reason the government should be burdening an entire generation with rates twice as much as mortgage rates. Since you cant discharge them in bankruptcy, I don't see how these loans aren't more secure than basically every other loan out there.

I would imagine that they make the feds a decent amount of money. Can anyone comment on this? I don't feel like looking it up.

 

[PTI (pti)]

Should probably look into transferring to a school where they will count like the BCTC/UK setup.

Yeah, no kidding.

Pretty simple philosophy.

 

[LadyCat92]

Given the AP classes that kids can take in HS nowadays, there's no reason why a kid can't come out of high school with the basics covered.

 

[jamo0001]

Given the AP classes that kids can take in HS nowadays, there's no reason why a kid can't come out of high school with the basics covered.

a lot of schools won't let you use AP credit for courses that are required for your major, though. AP is rarely gonna get you out of college a semester early or anything like that

 

[BankerCat12]

Have a client that used his student loan as a down payment on a house in Lex and then rented it out to his 3 buddies. Granted, this was before the mortgage crisis so income or lack thereof was not an issue. House is now paid off and just printing money.

 

[KingOfBBN]

Too many fools who have no business going to college are going to college. We need more people with knowledge of skilled trades in our country, from carpenters to computer techs. I've never seen a job description looking for a philosophy major.

This is probably what pisses me off the most. When I hear someone get degrees in things like Chicano Studies, American Studies, African American Studies and Philosophy, I think..."WTF are you going to do with that degree other then come back and teach that BS to other suckers?"

 

[KingOfBBN]

Have a client that used his student loan as a down payment on a house in Lex and then rented it out to his 3 buddies. Granted, this was before the mortgage crisis so income or lack thereof was not an issue. House is now paid off and just printing money.

That's incredible. That's about as good as the prostitution business that Joel set up in Risky Business.

 

[crazyqx83]

Obama already said he wants to lower the interest rates on these loans. So, to the 27 year old barista with a masters in underwater basket weaving and $197,000 in debt, congrats and saving $14/week in interest.

What more do you want??

If you have $200k in loans, then a fraction of a percent lower rate would mean more than $14 a week.

 

[GoCatsForever2k15]

Student loans are the next financial crisis. We're ignoring it a la the mortgage crisis for now, but the bubbles there.

 

[crazyqx83]

Grants / loans haven't kept up with the massive increases in tuition and costs. Too lazy to look up , but I know colleges have increased tuition substantially since early 90s. How much of an increase in grants since then ?

Not everyone is gifted with superior academic success , athletic talent, or parents that can afford to pay. Most people are none of these. There needs to be a better system for all.

Another problem is that boomers went to school with tuition costs subsidized by the tax payer and are now doing everything in their power (like voting in politicians like Bevin) to minimize that burden on themselves. But they'll be good damned if somebody mentioned tax cuts to senior entitlement programs.

(yes, another boomer rant).