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Old 12-12-2018, 02:39 PM
 
11,317 posts, read 3,994,063 times
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Quote:
Originally Posted by Ranredd View Post
I think a big part of the Fed not allowing bankruptcies for student loans is that there isn't much collateral for the loaned money. Its not like there's a car, house, building, assets, that they get back. It would be assumed that they can't get back the "knowledge" that's gained through the loan.

Now if this were the matrix and you paid an amount to download all the info to your brain - THEN it might be allowed.
I would think that you would find that virtually all those who seek bankruptcy lack assets. The ability to seek bankruptcy requires it. There would be no need to prevent bankruptcy from student loans if those who received them had the income to pay them back. They don't.

And they knew when they enacted the programs this would be the case. Hence the no bankruptcy clause.
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Old 12-12-2018, 02:49 PM
 
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Originally Posted by lvmensch View Post
I would think that you would find that virtually all those who seek bankruptcy lack assets. The ability to seek bankruptcy requires it. There would be no need to prevent bankruptcy from student loans if those who received them had the income to pay them back. They don't.

And they knew when they enacted the programs this would be the case. Hence the no bankruptcy clause.

And the education is a permanent asset. Even if there is no current income there may be a potential for significant future income.
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Old 12-12-2018, 03:03 PM
 
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Originally Posted by oceangaia View Post
And the education is a permanent asset. Even if there is no current income there may be a potential for significant future income.
And the kid may win the lottery and pay it all off. But what are the probabilities?

What you do is go to the actuaries and let them give you their best estimates. And that outcome appears clear.
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Old 12-12-2018, 03:19 PM
 
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Quote:
Originally Posted by lvmensch View Post
And the kid may win the lottery and pay it all off. But what are the probabilities?

What you do is go to the actuaries and let them give you their best estimates. And that outcome appears clear.

And that is true so what is the objection to suspending a loan rather than forgiving it? If he never wins the lottery or turns his life around, it keeps getting re-suspended until it is dismissed upon his death. But there is just no good reason to dismiss a debt permanently when their situation is not permanent.
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Old 12-12-2018, 03:41 PM
 
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Quote:
Originally Posted by oceangaia View Post
And that is true so what is the objection to suspending a loan rather than forgiving it? If he never wins the lottery or turns his life around, it keeps getting re-suspended until it is dismissed upon his death. But there is just no good reason to dismiss a debt permanently when their situation is not permanent.
You talking all debt or just student loans? If you wish to revise the BK code go for it...but I doubt you get very far. And what do you propose to do about the interest on the debt?

I think you will find vast resistance to changing the BK code. Much of bankruptcy is busdiness related and they do not want a "pending forever" solution.

I would have no problem with such a thing if you can avoid getting into the situation where it punishes success. If you limit it to a small percent of income it could be livable. Something like 1/2 of FICA or so.
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Old 12-12-2018, 03:48 PM
 
Location: Silicon Valley
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Quote:
Originally Posted by jghorton View Post
This sounds like a "tail wagging the dog" proposition. It's an interesting perspective, but, by the same rationale, one might also bring down the cost of homes, cars and healthcare... by reducing the available flow of income and financing.

Perhaps it is instead time for the public to weigh the cost of a college education with the value provided and ask, "Does it really make sense to indebt one's self $60K+ for a basic liberal arts degree - for which there is little demand?" To me, this is more of a 'parenting' problem than a federal student loan problem.
Beware the ebb and flow of the future. A long time ago when I graduated, there weren't enough accountants. It was considered the "hardest" of the business tracts to take then as you needed learn many rules and theories and get prepared for the CPA exam. I recall a job fair that had more potential employers attending than there were students. Even amongst us, the mostly highly sought was this guy that doubled with an information systems degree...why hang with the geeks?

On the other end of the spectrum was Marketing. For the solid C student whose family was bound and determined to get their charismatic son/daughter with a degree, there was marketing majors. Creative and socially apt were great, but if not, you could sleepwalk through your coursework.

Today I'd say that has flipped. Marketing today is analyzing Big Data and measuring multiple channels in order to create actionable execution plans. To make it in Marketing, you need to be bright and understand databases and queries. The speed of the tool development has been quite fast. Accounting on the other hand has let their standards go...and now is in danger of being outsourced overseas. Of the last 10 offerings, I'd say 8 had outsourced accounting functions. The fact that they need me is because they're waking up to the fact that most don't work, and while effectively avoiding the pain of dealing with problems, those problems have now multiplied.

But, as we return to the ever ballyhooed argument on liberal arts majors...an argument I've uttered myself previously, I'm now more hesitant. These have updated as well. What was the last concert you attended? Were the visuals amazing? Was the sound quality so much better than thinks once were? All that capex we hear Netflix is doing...is really creating a golden age of content development. Do you even bother to watch the shoddy home cam YouTube videos anymore? How is society going to handle all of these old boomers as they become infirm. Yes there's doctors, but what about the social workers?

My wife went to school for a bit, but she dropped out to do alterations. There isn't an alteration school. Learning to sew went out of style so long ago that ladies didn't learn it as it was demeaning, and men didn't learn it because it was still considered ladies work.

Now, few know how to do it, but there's still a big need for it. She does quite well.

In the mining industry, there's a saying that the cure for too much production is low prices, and the cure for too little production is high prices.

I think the government should leave their student loan program alone. If people want to take them, so be it. However, if they wanted to help people, they may want to rethink licensing requirements for certain jobs. What is truly needed in order to be an x, y or z. Don't dictate a 4 year program. Dictate passage of an exam. Innovation will finally then hit education as people scramble over themselves to find easier and shorter ways of getting talent lined up...whether via apprenticeship, online programs or a mixture of both.

When the Universities wake up to the competition, they'll either finally innovate themselves...or they'll die.
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Old 12-12-2018, 08:07 PM
 
6,257 posts, read 3,354,500 times
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Quote:
Originally Posted by Rocko20 View Post
https://www.cornerstone.edu/blogs/li...hat-can-you-do

It seems that federal student loans are wrecking havoc on America’s young adults. Schools can pretty much charge whatever they want now, so long as they know Uncle Same will front them the money.

Is it time for congress step in and greatly limit access to federal student loans, which would presumably decrease tuition rates when no one can afford to go to expensive public and private universities? Of course students could still go to private lenders but no doubt federal student loans are the gist of the problem.
Why do you think federal student loans are related to the increase in tuition?
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Old 12-12-2018, 08:15 PM
 
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Originally Posted by bpollen View Post
Why do you think federal student loans are related to the increase in tuition?
Because the cost of tuition was reasonably stable in the decades before the federal loans. My children for instance all attended various UC or Cal State colleges with no loans financed by me. My stray actually went through that and a Phd with no support other than her own earnings. She got free room and board from us though her master degrees but did most of her doctorate without help..late in it she was married and that carried her.
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Old 12-13-2018, 12:58 AM
 
760 posts, read 883,285 times
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Quote:
Originally Posted by bpollen View Post
Why do you think federal student loans are related to the increase in tuition?
Because colleges will always get their money back from the government, regardless if the borrower repays or defaults. So the schools can afford to raise their prices as high as they please.
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Old 12-13-2018, 05:05 AM
 
Location: Long Island, NYUSA, Earth, Solar System, Milky Way.
6,925 posts, read 2,028,345 times
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Quote:
Originally Posted by Rocko20 View Post
https://www.cornerstone.edu/blogs/li...hat-can-you-do

It seems that federal student loans are wrecking havoc on America’s young adults. Schools can pretty much charge whatever they want now, so long as they know Uncle Same will front them the money.

Is it time for congress step in and greatly limit access to federal student loans, which would presumably decrease tuition rates when no one can afford to go to expensive public and private universities? Of course students could still go to private lenders but no doubt federal student loans are the gist of the problem.
The underlying or root cause of the upcoming student loan imbroglio is, imho, our 'for profit education systems'.

America’s Student Loan Debt Crisis Is About to Get Much Worse

America

Quote:
Students attending for-profit universities and community colleges represented almost half of all borrowers leaving school and beginning to repay loans in 2011. They also accounted for 70 percent of all defaults. As a result, delinquencies skyrocketed in the 2011-2012 academic year, reaching 11.73 percent.
The deepening student debt debacle isn’t just bad news for students & recent graduates, it's broadcasting 'red flags' galore for the broader economy.

Personally, my sympathies go out to the younger generations who are, & will be, experiencing the most pain.

The piece linked here ^ has much pertinent info. The 'long story short' version 'take away' for students:

“Students shouldn’t assume their loan servicer has their best interest in mind.”

For students & recent grads:

Quote:
“Obama Student Loan Forgiveness” is a nickname for the William D. Ford Direct Loan program. The name came about when President Obama reformed part of the Direct Loan program in 2010 by signing the Health Care and Education Reconciliation Act of 2010. As a result of expanded funding for federal student loans, more borrowers gained access to more options with loan repayment.

President Obama made the following changes to federal student loan forgiveness:
  • The federal government will no longer give subsidies to private lending institutions for federally backed loans.
  • Borrowers of new loans starting in 2014 will qualify to make payments based on 10% of their discretionary income.
  • New borrowers would also be eligible for student loan forgiveness after 20 years instead of 25 on qualifying payments.
  • The money will be used to fund poor and minority students and increase college funding.
https://www.studentdebtrelief.us/stu...orgiveness/#12

Mr. Trump's so-called 'plans' for the deepening problems, including the problems associated with the upcoming student debt crisis, (so like many of his other schemes), is to 'undo' solutions proposed by the previous administration.

Long story short version for students & recent grads here is, 'hold onto your hats':

Quote:
Sadly, those answers are scary for a huge number of student loan borrowers. Reports as of May 2017 are that Trump and DeVos’ initial education budget will seek to eliminate the Public Service Loan Forgiveness program which could cost student loan borrowers billions of dollars. Trump and DeVos will likely seek to eliminate over $700 million in Perkins Loans and massively reduce the amount of work-study programs.
Trump Student Loan Forgiveness

https://www.studentdebtrelief.us/stu...iveness/trump/
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