Student Loans -- Banks and homeowners are getting bailouts

[JDPriestly]

How about student loans? You can't go bankrupt on most student loans. Is that why we aren't hearing about defaults on student loans? I had a job reviewing complaints in courts in the 1990s. Even at that time, the numbers of federal complaints against people who failed to pay their student loans was surprisingly high. I wonder what it is today. I tried to Google the total amount of student loan debt in the U.S., but could not find any numbers. Does anyone know the numbers or how to find them?

I view student loans as the modern version of indentured servitude.

This article is a couple of years old, but it illustrates my point:
But Mr. Park wanted to be a chef. So like tens of thousands of other young people who grew up in the age of kitchen celebrities like Bobby Flay and Emeril Lagasse, he enrolled in culinary school.

Two years after graduation, all the “Bam!” has been drained from the dream. Mr. Park makes $10.50 an hour at a bistro in Austin best known for its French fries, trying to pay down his student loans. While he dodges phone calls from the bank, his mother helps him make his $705 monthly payments, almost twice his weekly take-home pay.

“I wouldn’t wish this on anyone,” Mr. Park, 29, said before starting another night shift at the Hyde Park Bar and Grill. “I put my degree on applications, and they make fun of me for it.”

http://www.nytimes.com/2007/05/08/us/08default.html

[OhioChick]

1. Rec #1 n/t

[Dr Fate]

2. I wish I had bought a house a couldnt afford instead of investing in an education I couldnt afford.

It would have been the better risk, at this point.

[readmoreoften]

11. I figured that out and bought a house. It was a better economic decision.

I have 4 rooms. I can rent out two and I pay no more than I would as a renter. Maybe $100 more. It's the best decision I ever made. Education? Some of my schooling was worthwhile. Some wasn't.

[old mark]

3. You are right about the indentured servitude - the amount of money

I owe is over 42% more than what I borrowed because of long ilnesses (heart disease) whenI could not work. I didn't have to pay the loand, but they capitalized the interest, and I'm still paying off the loans I took out when I went to college in my 40's at nearly age 62. I will be using my social security to pay off my student loan.

mark

[JDPriestly]

4. And getting a job that pays enough to pay off your loans in this

worsening economy is going to become impossible. Student loan borrowers unite. We indentured servants have nothing to fear. Break the chains. Abolish the slavery of student loans.

[VenusRising]

5. It's not as if the Obamas don't understand this, too.

They only recently paid off their student loans because of his books sales.

They were lucky. A lot of people are not so. We owe over 6 figures for my husband's PhD. The last job he applied for 400 other PhDs applied as well. There are a lot of hiring freezes going on right now, too, and I worry about not being able to make the payments. He's still able to defer payments at this point because he graduated recently.

[Riley18]

6. I put my student loan on hold, and the interest will continue to accrue. The

$245 every month is needed for food and electricity. I've been paying it for 10 years, and had to stop this year. I still owe about $30,000, and on a Florida teacher's salary it just became one more thing I cannot afford.

[mwooldri]

15. How long have you been a FL teacher? Are these Fed loans?

I know if you work in some impoverished school districts you can get part of your loans forgiven for working as a teacher, provided your loans were after 1998. It'd be surprising which schools are considered "low income" - all of Guilford County Schools in NC are considered "low income". Teach Maths or Science at Secondary level and you get more money, as you do also if you're a special education teacher.

http://studentaid.ed.gov/PORTALSWebApp/students/english/cancelstaff.jsp?tab=repaying

Mark.

[proud2BlibKansan]

19. I am a teacher and I went to college for free

Didn't have to pay my loans back. I worked them off at 10% a year as I taught.

I cried when I heard Reagan had done away with that program. One more reason I hate him and what he did to destroy the middle class.

[girl gone mad]

7. How do you make it just?

If I had known the debt would just be erased, I might have taken out loans for school rather than working and saving to pay for it. I have friends who worked 3 jobs while in school to avoid student debt.

I would support reducing or even eliminating interest, but allowing people to walk away from the debt would be a slap in the face to people who didn't go to college because they couldn't afford to or who made enormous sacrifices to pay out of pocket.

Also, the homeowner bailout isn't exactly progressive. A lot of people who choose loan modification will end up worse off.

[starroute]

8. Saving society is not a "slap in the face" to you personally

Excessive debt is an enormous burden on the entire nation. Those burdened by student loans can't spend their money in ways that would help support the economy, can't take a chance on more risky and entrepreneurial career choices, may be having trouble starting families or becoming bedrock members of society during what would otherwise be their most productive working years.

Student loan relief would free up human and financial resources all across the economy and benefit everybody.

So suck it up and don't take it as a personal insult, ok? You've already had the payoff for your hard work by not being under a debt burden during the years since then. Beyond that, this really isn't about you.

[Lyric]

12. In other words, No fair, I didn't get mine!

Are you effing serious?

I'm really glad that you had a choice about college. Obviously, since you were able to "choose" not to go for the sake of not getting yourself into debt, you must have judged that you had alternatives that could/would support your existence. Some of us had no alternatives. It was either college or welfare/hunger/homelessness. Some of us go because nobody in our family has even graduated high school before, and we have NOTHING in the way of resources and/or family to fall back on, even temporarily, if we cannot get really good jobs--the kind that require a degree. Some of us are going because without a college education, we would die alone working at McDonald's with no pension and no retirement, and our children would grow up in the same hell of poverty that *we* did.

It's great that you had the luxury of a choice. Be grateful for that. For others, the choice was to take on the debt, or to live in extreme poverty for the rest of our short, miserable lives...which really isn't much of a choice at all.

And of course, there is the fact that our economy is in a tailspin because crushing debt has basically brought the flow of money to a standstill. There is the fact that student loans are especially onerous and unfairly handled by bankruptcy courts, to the point where families are being destroyed because a single medical crisis has taken away a desperately-needed income and the payments on the loans are no longer affordable. But hey, let the country burn down...just so long as everything is destroyed *fairly*.

*sigh*

[girl gone mad]

16. You don't understand.

A lot of people in this never go to college because they can't afford it, even with loans.

You made a choice to take out loans. Even if you feel that your circumstances forced you to have to go to college, you could have chosen alternative means of paying for it.

If we decide to forgive the debt of people who chose to defer payment to the future, it will be at the expense of those who already paid or could never afford to pay. The money has to come from somewhere.

So how do you design a system that's equitable and doesn't punish people who already made sacrifices?

I went to college, btw. I worked to pay for my classes. I got accepted to MIT, but the debt would have been way too burdensome considering the career options in my field, so I chose a state school. Had I known other people would pay my debt later, maybe I would have chosen differently. I went to school with a boy whose family lived in virtual poverty so they could pay to send him to school. Can you understand why someone like that would be upset to hear that people who took on too much debt are going to end up with a free or greatly subsidized education?

[deaniac21]

14. Girl not gone mad. Girl smart.

[JDPriestly]

17. I'm not talking about erasing loans. They charge horrible

interest on the private student loans. The worst of it is that they accrue the interest on the loans while you are in school.

Education should have been free for you just as it should be free for everyone. Had you enjoyed the same opportunity for an education as the children of the wealthy -- children like Obama's children, like the Clintons' daughter, society would have benefited -- not that you aren't great and beneficial to society as you are, but the more educated people there are in a society, the better the whole society.

Having an education does not mean you have to choose intellectual work. I have good friends with degrees who love carpentry and home repairs. They run good, solid businesses and love what they do. Their educations make them better able to compete, make them better people, make them better in their work.

No one should be deprived of the opportunity for a college education because of lack of money. No one should have to be indentured for 30-40 years by student loan debt. Many of the most worthwhile jobs don't really pay enough to cover the debts. Teachers' salaries don't suffice to pay for the loans that a teacher needs to take out to pay through a Masters degree, for example.

[Omnibus]

22. "Slap in the face"?

By your thinking, then, since I don't have kids, paying for children's education/health care is "a slap in the face" to me.

at some point, nearly everyone is someone else's slap in the face. Turn the other cheek and help them anyway--that's how a society works.

[BrightKnight]

9. I paid for my private out of State education w/ loans and I paid them all off.

The interest rates were high and I wasn't working great jobs for most of the time. I struggled with them at times and I think that I exceeded the forbearance limit on a few of them. I am grateful for the opportunity that I was given. I did not need a handout.

[readmoreoften]

10. Well good for you. Aren't you lucky to not be scammed by a criminal finaid department.

And someone I know who got a full scholarship to an ivy league school for being an impoverished female science genius was charged a small loan while in school that blew up to $50K because of interest and now they won't release her diploma. All she wants to do is teach science in her old hometown that desperately needs science teachers but she's working construction and hiding her tools from being confiscated by the government. She is so underwater for not fulling understanding paperwork she'd have no grasp of at 18 having grown up in a trailer park that she believes she'll live the rest of her life as a fugitive.

Lucky you that you weren't part of one of those student loan scams that Cuomo busted in NY. I was forced to drop out of school or take a private loan. I was told it would never go over 7%. It's now at 12% and can't be consolidated. It paid for 1/2 of 1 semester--the only semester that wasn't covered by full tuition remission and scholarships. They misfiled my paperwork claiming that I graduated years before I did and now I am fighting to not pay penalties for not paying while I was enrolled because of their computer error.

You can't pay back TWICE your salary a month and survive. It's not possible. It has nothing to do with a work ethic.

[mwooldri]

13. There's plenty of help for those with FEDERAL student loans.

There is the Income Sensitive Repayment Plan. Switch to that if you have little or no income and don't foresee you having ANYTHING for the next X years. Sure you will have to make *SOME* payments but not like huge amounts of money. If still not paid off after being on Income Sensitive for X years (I think the max is 10) then your student loan is written off.

You can defer. You can get forbearance. If you have not consolidated and are on a standard 10 year payment plan on lots of loans, then you can still consolidate with the federal government and extend the payment terms from the standard 10 years to 25. I did; I consider it my federal bailout, because I switched from having to pay about $600-$700 a month for 10 months to $240 a month for 25 months.

However PRIVATE student loans are a totally different story. Those are definitely dependent on the paperwork - how it's written, what guarantees there are, any get out clauses if any. But because it's considered a STUDENT loan, yep, you cannot Chapter 7 your way out of those. Something needs to be done about these types of loans.

[Omnibus]

18. Damned Right!

If I didn't have my student loan payments, I could actually get by on unemployment!

[dysfunctional press]

20. $705 monthly payments? what kind of terms did he agree to?

that sounds nuts.

[libnnc]

21. freaking-A

K&R

:kick: