Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Are you sure the debt can’t be discharged? I recently heard a VERY similar story on the radio (Dave Ramsey): a temporarily disabled graduate (doctor) saying that he paid off ALL his humongous debt—in a short amount of time—& is currently practicing medicine debt-free. Is this coincidence or a strategy?
Most EVERYONE involved in student loans are @ fault here—the reality of moral hazard is savvy, common knowledge!
Almost never dischargeable. Last year, just 129 discharges nationally.
I just did a quick Google search and found that as of the end of 2012 student loan debt in the US was $956 billion and credit card debt in the US was $858 billion.
Student loan interest rates are approximately 5% - 10% based on the lender and when the loans were originated. They are structured debt whose interest is a tax deduction, even if not itemizing deductions.
Credit card interest rates are upwards of 24% and unstructured debt.
At least the students received an education, which can never be taken away. That's more that can be said for the billions of dollars of interest that will be paid this year on yesterday's lunch, which is already gone.
Failure to complete the degree program. This is associated with coming from a low income background, having parents with lower education levels, and lower income and higher unemployment.
Attending a for-profit school
Race and ethnicity. Differences persist even after controlling for post graduation earnings.
Age. The info is contradictory as to whether younger or older borrowers may be more likely to default.
Gender. Less clear. Females may be slightly less likely to default.
Lack of a high school diploma.
Ignorance about borrowing.
Other factors, including health crises, lack of academic success, more dependents, field of study, and the quality of the loan servicer.
It would seem that students who are not completing courses, or failing them and maintaining a low GPA should not be in college and should not be allowed to borrow money.
Loan proceeds should not be available for students at for profit schools with low graduation rates and whose students are unable to get jobs that will allow them to repay them. Since over 90% of the students at those schools borrow money, the bad schools would go out of business.
As others have mentioned, a student should be required to demonstrate an understanding of the loan process and the absolute need to repay the money. The person who plans to borrow $100k to pay for a theater arts degree needs to be brought down to earth very quickly.
Finally, there should be options for the person whose inability to pay is truly beyond his control, such as due to a serious illness.
We need to first keep students from digging holes that they obviously will never be able to dig themselves out of though.
This is not true whatsoever. One of the most misguided comments I have heard on here.
It's a fact actually. The top 100 schools graduate undergrads with about 15k in debt on average. So since it is a fact surely you have seen more misguided comments.
Failure to complete the degree program. This is associated with coming from a low income background, having parents with lower education levels, and lower income and higher unemployment.
Attending a for-profit school
Race and ethnicity. Differences persist even after controlling for post graduation earnings.
Age. The info is contradictory as to whether younger or older borrowers may be more likely to default.
Gender. Less clear. Females may be slightly less likely to default.
Lack of a high school diploma.
Ignorance about borrowing.
Other factors, including health crises, lack of academic success, more dependents, field of study, and the quality of the loan servicer.
It would seem that students who are not completing courses, or failing them and maintaining a low GPA should not be in college and should not be allowed to borrow money.
Loan proceeds should not be available for students at for profit schools with low graduation rates and whose students are unable to get jobs that will allow them to repay them. Since over 90% of the students at those schools borrow money, the bad schools would go out of business.
As others have mentioned, a student should be required to demonstrate an understanding of the loan process and the absolute need to repay the money. The person who plans to borrow $100k to pay for a theater arts degree needs to be brought down to earth very quickly.
Finally, there should be options for the person whose inability to pay is truly beyond his control, such as due to a serious illness.
We need to first keep students from digging holes that they obviously will never be able to dig themselves out of though.
I was speaking about only undergraduate. It gets complex when you get into masters and doctorates. 100k in debt is not much for a Pharmacist or Doctor that will make 120k a year. It is all relative.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
