The first pebble in the student loan default landslide

[Alpo]

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.

...from Thomas Jefferson's May 28, 1816 letter to John Taylor.

The worldwide banking model is just as dangerous to developing countries as it is to students.

We gave the banks plenty of money to "save" the economy from a depression when we should have taken many of the Wall Street plutocrats out and shot them.

There should be no debt that is not dischargeable in some fashion by those truly crippled into living a life that is tantamount to economic slavery.

 

[PistolBob]

Many of these over priced socialists mills will fold under their own weight. If the snowflakes can not get grants/loans they will have to stay in moms basement.

Neighbor has a 28 yr old kid living in the house....the kid got a useless degree in Fine Arts and ran up over $70K in student loans. Works at Meijer restocking shelves. Not many jobs for oil painters, sculptors, and pencil artists.

They may be interested in this new bankruptcy opportunity.

 

[DeadeyeChrista'sdad]

Some days I miss my student job with Ball State's tree crew. Some days my back says I don't.

 

[ashby koss]

Maybe the snowflakes ought to join the service before they melt in mommy's basement?

Both of my kids forged into this world working whatever jobs they could meek out a living and have prospered well. Nothing wrong with skilled trades and apprenticeships!!

later in life, as with my hiring. The reality is that these life trained skills and trades/apprentices are far more to be better employees and more desirable in the workforce of a company. We have found at my company, can have 25 accountants, and 100 engineers, but you need at least 1 good guy on the floor to make the product to sell.

 

[two70]

...from Thomas Jefferson's May 28, 1816 letter to John Taylor.

The worldwide banking model is just as dangerous to developing countries as it is to students.

We gave the banks plenty of money to "save" the economy from a depression when we should have taken many of the Wall Street plutocrats out and shot them.

There should be no debt that is not dischargeable in some fashion by those truly crippled into living a life that is tantamount to economic slavery.

Or instead of rewarding poor decision making, we could require at least a modicum of responsibility from the borrowers. It seems divorcing people from even the smallest bit of personal responsibility is how we get problems, not how we solve them.

How is voluntarily entering into a loan economic slavery? At absolute worst, it is voluntary indentured servitude.

 

[HoughMade]

She did it. She didn't blame the feds, the college or the banking system for her troubles. She took responsibility and did what was necessary.

[video=youtube;3W0VtWGohno]https://www.youtube.com/watch?v=3W0VtWGohno&t=97s[/video]

 

[phylodog]

Buying votes, plain and simple. Vote for "our team" and we'll make your super difficult, unfair life soooo much easier.

Disgusting

 

[KMaC]

Making bad decisions is common when you're young. What chaps my @$$ are the kids that use student loans to party, take a trip to Europe (I read this in a news article a few years ago) or other non-educational use. This is more akin to fraud. To allow them to evade payment and cause taxpayers to pay for their foolishness is infuriating.

 

[DoggyDaddy]

Making bad decisions is common when you're young. What chaps my @$$ are the kids that use student loans to party, take a trip to Europe (I read this in a news article a few years ago) or other non-educational use. This is more akin to fraud. To allow them to evade payment and cause taxpayers to pay for their foolishness is infuriating.

That could be solved by having the loan money sent directly to the schools so that the students never get their hands on it. Same reason why you don't give a beggar on the street corner cash. Give them a sandwich. See what reaction you get.

 

[HoughMade]

That could be solved by having the loan money sent directly to the schools so that the students never get their hands on it. Same reason why you don't give a beggar on the street corner cash. Give them a sandwich. See what reaction you get.

They do. The school takes what it s owed and the students can get the difference back...which the honest ones use to pay for things like housing and food.

Oh, and if you think that colleges don't set up overseas trips for the students that mainly sightseeing, paid for by loan money, but they get credit for anyway....

 

[Hkindiana]

That could be solved by having the loan money sent directly to the schools so that the students never get their hands on it. Same reason why you don't give a beggar on the street corner cash. Give them a sandwich. See what reaction you get.

When I lived in San Francisco, I witnessed, several times, beggars with signs that read “I need money for food” THROW DOWN on the ground food that was given to them. I just watched a court show where a woman was suing someone for the cost if her car. She had used student GRANT money to purchase the car and said “i worked hard for that money - by getting good grades”

 

[DoggyDaddy]

They do. The school takes what it s owed and the students can get the difference back...which the honest ones use to pay for things like housing and food.

Oh, and if you think that colleges don't set up overseas trips for the students that mainly sightseeing, paid for by loan money, but they get credit for anyway....

I guess my view is that there shouldn't be any excess approved by the lenders, but I'm not naive enough to believe that would ever happen. The lenders see student loans as a cash cow, especially given the difficulty in having them discharged through bankruptcy.

Edit: Alternatively, they could approve loan amounts based on the earning potential for the degree being sought.

Lender: "I see you're going to be enrolling in "_______ studies". The average starting salary for someone with a bachelor's degree in "_______ studies" is $20,000 per year. Therefore, we're really only comfortable in lending you an amount that you're likely to be able to pay back within 5 years of graduation on a salary of $20,000/year."

VS.

Lender: "I see you're going to be enrolling in chemical engineering. The average starting salary for someone with a bachelor's degree in chemical engineering is $60,000 per year. Therefore, we're comfortable in lending you an amount that you're likely to be able to pay back within 5 years of graduation on a salary of $60,000/year." (which would be considerably higher than someone making $20,000/year).

I mean, that's how virtually any other type of loan (car, house, etc.) would work, so why not school loans?

 

[eldirector]

IMHO, loans should have collateral. For mortgages, it is your house. For cars, it is the car. For businesses, it is the business assets.

What is the collateral for a student loan?

It should be EXCEPTIONALLY difficult to secure money on the promise of some future repayment, with no collateral at all.

People only value something when they have skin in the game.

But, then again, the entire purpose of the student loan racket wasn't to help folks get an education. It was to pass tax money through to lending institutions and schools.

 

[natdscott]

IMHO, loans should have collateral. For mortgages, it is your house. For cars, it is the car. For businesses, it is the business assets.

What is the collateral for a student loan?

It should be EXCEPTIONALLY difficult to secure money on the promise of some future repayment, with no collateral at all.

I am glad somebody understands that. It’s not just collateral either:

No job = no capacity to repay.

No assets, and a crap capital position because they’re youngsters.

No collateral because of same.

No positive credit history: as likely as not, the lender is making a loan to a lying little rat with nothing but a signature to their name.

Possibly loans made to Juniors, cosigned by adults who can also be questionable borrowers.

No GUARANTEE of any timeline for repayment.

No GUARANTEE of any job to provide capacity to repay.

Not even a guarantee that they will graduate AT ALL...and therefore may not ever obtain that ivory tower job that seemed like a good idea at 19.

...all of this while being asked to lend at WAY under 10% APR, to fund the “purchase” of an intangible asset.

Well goll-ee, boys. As a professional, I can tell ya, the technical term for that credit package is dog****.

Again: If the guaranty against student loan default is proven to be unconstitutional, that whole system will implode.

If you’re one ‘a the simpletons that say “ just let it burn”, I urge you to educate yourself on the volume of money we’re talking about, and the economic ramifications if all of that is allowed to wash down the drain.

Whether you took part in, or even agree with, the regime that got us here is irrelevant. Being that we’re in the hole, we now need to find a way out of it...first and foremost by putting down the shovel.

 

[PistolBob]

My idea....

The feds need to publish a list of degree programs they are willing to finance based on national need. This list needs updated annually. If you seek a degree on the list, then you get tax payer guaranteed loans. If a school wants more students that come with cash, they need to offer programs on the list. Stop loaning tax payer guaranteed money for worthless degrees. That list could also contain vocations in which we need trained and educated workers....same deal. Unions and voc-tech schools offering skills improvement programs in those voacations, get a shot at more students with tax payer guaranteed money.

Stop paying to train a philosopher on the tax payer dime.

 

[Nevermore]

IMHO, loans should have collateral. For mortgages, it is your house. For cars, it is the car. For businesses, it is the business assets.

What is the collateral for a student loan?

It should be EXCEPTIONALLY difficult to secure money on the promise of some future repayment, with no collateral at all.

People only value something when they have skin in the game.

But, then again, the entire purpose of the student loan racket wasn't to help folks get an education. It was to pass tax money through to lending institutions and schools.

Literally begins and ends the entirety of student loans as a whole for me. The only things expanding for a good long while were hospitals and higher-learning institutions: guess which two things were obligated to be funded directly by the hand of the govt...

 

[HoughMade]

I think a few people have missed both the purpose of student loans and the nature of federally insured loans.

Not saying they’re wrong, just that point is not an investment to make money. It’s a welfare program, of sorts.

 

[Hookeye]

My middl kid graduated w no debt.
My oldest could have. But will proly owe 20k tops
When she finishes her nursing degree.

Note.....I have no grandkids.

 

[Hookeye]

People today want to do whatever the hell they want and any issues that come about from poor planning or decisions, well theyre victims and its somebody elses fault.

Screw em.

Homeless w large predators reintroduced.....should help the labor market soon enough.

Id be cool w a grizzly chewing on a democrat in the park.

 

[Alpo]

Or instead of rewarding poor decision making, we could require at least a modicum of responsibility from the borrowers. It seems divorcing people from even the smallest bit of personal responsibility is how we get problems, not how we solve them.

How is voluntarily entering into a loan economic slavery? At absolute worst, it is voluntary indentured servitude.

Poor decision making? You mean like decisions by banks that drove us into the ditch in 2008? Or the savings and loan disaster back in the 1980's and 1990's that drove over 1/3 of the industry into bankruptcy?

Sometimes the rugged individualism on this site is so far removed from reality that it's laughable.

People suffer economic crises for many reasons. The bankruptcy laws are there to protect them from your obviously preferred method of punishment in a debtor prison.

Similar laws protect corporations. I'm glad to see there is a higher regard held for poor decisions by banks and Wall Street firms than there is for Joe Plumber.

sheesh