What could Trump do about the student loan situation? (Harkin, problems, world)
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1) The rates are higher because student loans are not collateralized loans, so therefore much higher risk as there's no underlying pledged asset which secures the loan.
2) Student loan borrowers can and do default on student loan debt. In fact, 7 million student loan debtors are in default
1) Default is not discharge, the debts are still collectable and collected through garnishments and levies.
2) Student loans can only be discharged where there is a showing of undue hardship. Courts have interpreted that to mean when they interfere with basic structure and electricity. There have been VERY few instances of discharged student loans which is at issue. You're confusing default with discharge.
(8) unless excepting such debt from discharge under this paragraph would impose an undue hardship on the debtor and the debtor’s dependents, for— (A) (i) an educational benefit overpayment or loan made, insured, or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution; or
(ii) an obligation to repay funds received as an educational benefit, scholarship, or stipend; or
(B) any other educational loan that is a qualified education loan, as defined in section 221(d)(1) of the Internal Revenue Code of 1986, incurred by a debtor who is an individual;
1) Default is not discharge, the debts are still collectable and collected through garnishments and levies.
2) Student loans can only be discharged where there is a showing of undue hardship. Courts have interpreted that to mean when they interfere with basic structure and electricity. There have been VERY few instances of discharged student loans which is at issue. You're confusing default with discharge.
1) Default is not discharge, the debts are still collectable and collected through garnishments and levies.
Seems you didn't know that:
Quote:
Originally Posted by JGMotorsport64
Lenders have a sweet deal because they get to lend large sums of money at interest rates higher than market rates that debtors can't default on.
Clearly, student loan debtors CAN and DO default. 7 million of them, as a matter of fact.
Quote:
Originally Posted by JGMotorsport64
3) the inability to discharge is the collateral.
Inability to discharge a debt is not collateral. One can go to one's grave still owing non-discharged debt. There is no guarantee it will ever be paid back, therefore student loans aren't collateralized.
JGMotorSport64, it looks like you and I only disagree about the Government discharging current student loans.
I don't believe in any bail out of any sort from the Federal Government. People need to pay for the loans that they agreed to pay off when signing the promissory note.
The bailout mentality of this nation needs to go. People need to take responsibility for the decisions they make in life with the outcomes that come with it, good or bad.
Take a very close look at the books of the colleges and universities in our country. Because federal funding for college exists, the price keeps going up. Go straight to the root of the problem and hold universities accountable for price-gouging. At the very least, shine a huge spotlight on the over-the-top price of higher education.
Take a very close look at the books of the colleges and universities in our country. Because federal funding for college exists, the price keeps going up. Go straight to the root of the problem and hold universities accountable for price-gouging. At the very least, shine a huge spotlight on the over-the-top price of higher education.
I agree, but thats only half of it, the other half is the fact that you can't default on them, so its guaranteed money for the schools.
They can't be discharged, which means they'll continue to be a legal obligation and on one's credit record forever. But that doesn't necessarily mean they'll ever get repaid. There's no shortage of people going to their graves with unpaid and uncollected debt.
Cut Federal spending, it isn't their legal authority anyway, it is a state issue. What states do is up to them.
Right so, states with less money produce people with worse education than those with more money? Granted that's the way it is now, but now you've taken the federal subsidies away.
Not a very good system for those with little money.
They can't be discharged, which means they'll continue to be a legal obligation and on one's credit record forever. But that doesn't necessarily mean they'll ever get repaid. There's no shortage of people going to their graves with unpaid and uncollected debt.
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What ends up happening with private lenders is that they subrogate against the deceaseds estate and collect a a huge chunk of the debt that was unpaid.
Quote:
Originally Posted by Mikelee81
JGMotorSport64, it looks like you and I only disagree about the Government discharging current student loans.
I don't believe in any bail out of any sort from the Federal Government. People need to pay for the loans that they agreed to pay off when signing the promissory note.
The bailout mentality of this nation needs to go. People need to take responsibility for the decisions they make in life with the outcomes that come with it, good or bad.
Sorta, my contention is merely that they should be dischargeable in bankruptcy. The link I provided above is a list of nondischargeable debts.
They include
Tax penalties
Alimony
Child support
Fraud
Embezzlement
Judgments for larceny
Liability for killing somebody while drunk driving
Liability for securities fraud
The bailout mentality of this nation needs to go. People need to take responsibility for the decisions they make in life with the outcomes that come with it, good or bad.
The price gouging needs to go. It is the absurd pricing that causes these problems.
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