<p>I agree Arco. And just to be clear, even for debt that is dischargeable, the debtor has to show that he or she has no reasonable path to repay. Med Student, MIT or Wharton grad, not so likely. NYU Art History major, hmmm, maybe. These rules are sufficient to keep students honest. Who keeps banks honest?</p>
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<p>arco222,</p>
<p>I’m not sure what you are advocating here. Are you arguing that because college students’ brains are not fully developed, we should not treat them as we would full-fledged adults when it comes to repaying loans? If they are physiologically incapable of making informed decisions when it comes to borrowing, should we be making them loans at all?</p>
<p>Remember that no one is required to take out a loan. Some students do work and go to college part-time, using their income to pay for their education. Perhaps this should be the only option for students who cannot go to college without incurring debt?</p>
<p>I’m not clear what solution the anti-non-dischargeable side is proposing. If student loans become dischargeable, banks won’t lend, or will raise their interest rates to cover the increased risk, making loans even more expensive. Is that what you would prefer to see happen? Or are you saying that banks and taxpayers should be forced to make loans and be forced to bear the financial burden of borrowers who don’t repay but who acquire the benefits of an expensive education and enrich colleges with borrowed money? If so, what would be your rationale for doing that?</p>
<p>What happened to arco222’s post? It completely disappeared.</p>
<p>I’m going to say again what I implied above–cut the for-profits off from government student loans, and then see how much problem there really is. They are hugely inflating the numbers we’re seeing.</p>
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Agreed, something has to be done about those scams.</p>
<p>Something just dawned on me:</p>
<p>529’s, Coverdell’s and the like all have a list of “qualified expenses”. These qualified expenses do NOT include things like cars. Heck, most of the plans don’t even cover a computer unless it’s specifically required for a class/major.</p>
<p>As far as I know, all the government loans do not have such restrictions. (Or, if they do, they sure don’t seem to enforce them.) I’m not saying that would solve all the issues, but it might make a dent in the problem if we didn’t have students racking up debt for things that aren’t necessary for college.</p>
<p>Here is a start:
- Loans may not be used for for-profit institutions
- Qualified expenses only
- Max limit for ALL borrowing set to public u room, board, and tuition LESS a reasonable work/study plus summer employment income
- Mandatory acknowledgement on PAGE ONE of loan agreement regarding repayment schedule</p>
<p>I agree with comment above that if student loans are made non-dischargeable, that banks will lend a lot less. That scenario would prevent access to many students who need a manageable level of debt the most. </p>
<p>Not every kid can afford a private, 4 year, no-job, residential experience. I would love to give my kid a lot of things that I do not. It’s called being responsible.</p>
<p>I have zero sympathy for MOST students that end up carrying substantial financial debt, especially those that did so just to have the name of a “prestigious” institution on their CV.</p>
<p>I went to a state school, majored in Computer Science, and joined the National Guard so that I would be able to graduate with zero debt and find employment easily. Was it easy? No. Did I like everything I did? No. But I simply did what was necessary. </p>
<p>People have to get their heads out of their @sses and stop doing what they “want” and start doing what they “need”. Life’s tough. Man the F up.</p>
<p>I actually like the ROTC model (what I understand of it) and think that it could, with some modification, perhaps, be applied in the private sector. Let companies sponsor students for majors, paying some or all of the costs, in exchange for a promise to work for the company for some period of time in order to repay the debt. Of course, students are free to renege, but in that case students would be compelled to repay the debt in some other way (i.e., it becomes debt like it is now).</p>
<p>I have no sympathy for students who take on too much debt. However, I have little sympathy for lenders who make overly risky loans. College-for-work is a nice deal, one that can hedge bets on both sides of the table. The only downside I can see is that it would make things a bit harder to go to college if you’re not a good bet (i.e., it isn’t likely that your labor will be valuable)… but potential students in that situation may not need to go get their philosophy of art degree, even if they really want it.</p>
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The lenders aren’t bearing much risk. The educational loans are backed by the federal government. I believe that private lenders should bear more risk. They can add additional criteria on the suitability and ability of borrowers to repay their debts.</p>
<p>I think we should bring back debtors’ prisons, live in Dickensonian London, and let the poor die to decrease the surplus population. Oh, and call ourselves “holier than thou” Christians, at the same time. So that we can give tax breaks to billionaires. And protect criminal banksters and “free market” tycoons from accountability and the pain of their own greed and irresponsibility in crashing the entire world economy. And reward them with ever greater bonuses for their wonderful work, whenever possible. No jail - or restriction of bankruptcy options - for these great contributors to our society (be they actual human people or corporations, which are people, too, after all). Because they’re makers, not takers. </p>
<p>But students just leaving the nest? Oh yeah. They have to pay back every penny. On time. With interest. Or get sued. And live at poverty level, even into their senior years. No bankruptcy options for <em>these</em> irresponsible miscreants!</p>
<p>Because that’s the kind of accountability and meritocracy and basic fairness and intellectual consistency and “love thy neighbor” Christian sensibility that built this great nation and upon which patriotic conservatism is based.</p>
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<p>There’s no free lunch in this world. I joined the National Guard and risked life and limb for the benefits of service. It turns out I enjoy doing what I do in addition to the educational benefits I received. Your little “life isn’t fair” speech doesn’t get any sympathy from me.</p>
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<p>I couldn’t agree more.</p>
<p>I think these people who take out these loans need to pay back every cent.</p>
<p>If you’re smart enough to get into college then you’re smart enough to realize you need to pay back what you borrow.</p>
<p>A coworker of mine told me his loans are 890 a month. That’s the price off my mortgage. At least he’s paying them back. He said he has no regrets about taking them and his education was worth it. I’m assuming he’s almost done paying them back since he’s a little older then me. He also just got a position at work that aligns perfectly with his degree. </p>
<p>If you’re going to borrow that much, that’s the mentality you need to have.</p>
<p>$890 a month is cheaper than you can pay to go to any college in Michigan (if you count total cost of attendance to include transportation). For those who say you shouldn’t take student loans…If kids can’t afford that after they graduate from college and have a “real” job, how would they afford it outright, without loans?</p>
<p>890 a month over 15 years is 160k or 40k per year of college. That’s a huge amount of loans. Most people don’t come even close to borrowing that much.</p>
<p>I borrowed about 15k and I pay about 115 a month.</p>
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As a general rule, yes: I abhor the “10% of your discretionary income!” thing that college graduates get. The general rule should be that you pay back every cent that you borrow.</p>
<p>However, there are always business decisions that go bad, and when someone borrows to start a business that is a flop, we don’t hound him into the grave for his debts: he settles with creditors, limits his liability via various legal structures, or can declare bankruptcy. But the business decision to get a degree is the only one in which if it does not work out as anticipated, you can be hounded into the grave for that money. </p>
<p>Some of us see that as both inconsistent and fundamentally unjust. Yes, in an ideal world, no one would ever ever EVER make stupid decisions and borrow more money than they can pay back. However, in a less-than-perfect world, we need to figure out what to do with people who cannot pay back their debts, and I see zero reason to set student loans aside as special debt.</p>
<p>As I’ve said until I’m blue in the face, if you buy a house and you can’t afford the mortgage, you can walk away. Borrow a hundred grand for cars, vacations, and clothes, and you can declare bankruptcy or work with your creditors to get those payments down. Borrow money at age 18 to try to better yourself, and you could end up with your Social Security check being garnished. </p>
<p>That’s messed up.</p>
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<p>If they can’t afford it, then they should be going to a less expensive college, or going part time while working full time.</p>
<p>Re: #77</p>
<p>No, it is pretty simple. Loans for homes and cars are <em>secured</em> loans; you walk away and the bank takes your house and car back. I don’t think there are many (if any) people who can get $100,000 worth of unsecured debt for vacations and clothes; those would generally be credit card debts, and you can’t walk away from those too easily, and certainly not without wrecking your credit for years.</p>
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<p>See, I don’t know hardly anybody who can find a job that pays enough to cover their living expenses, let alone tuition too, if they don’t have a college education. Minimum wage doesn’t cover their living expenses. They are in a real Catch 22. Or, are you assuming that everybody can live at home at their parents’ expense while they spend 8 years doing that?</p>