The $555,000 Student-Loan Burden
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The $555,000 Student-Loan Burden
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Re: The $555,000 Student-Loan Burden
#2"Dr. Bisutti says she loves her work, but regrets taking out so many student loans. She admits that she made mistakes in missing payments, deferring her loans and not being completely thorough with some of the paperwork, but was surprised at how quickly the debt spiraled."
...
"After completing her fellowship in 2007, Dr. Bisutti juggled other debts, including her credit-card balance, and was having trouble making her $1,000-a-month student-loan payments. That year, she defaulted on both her federal and private loans. That is when the "collection cost" fee of $53,870 was added on to her private loan."
She's horrible at money, I have no pity. I will agree though that this form of debt should be dis-chargeable via bankruptcy.
Re: The $555,000 Student-Loan Burden
#3"Dr. Bisutti says she loves her work, but regrets taking out so many student loans. She admits that she made mistakes in missing payments, deferring her loans and not being completely thorough with some of the paperwork, but was surprised at how quickly the debt spiraled." ... "After completing her fellowship in 2007, Dr. Bisutti juggled other debts, including her credit-card balance, and was having trouble making he…
Be VERY careful what you wish for. The fact that student loans are not dischargable directly contributes to increasing their availability and reducing the interest rate charged. (By dramatically reducing the risk of default.)
Otherwise, why wouldn't someone just run up $300K, declare bankruptcy the day they graduate, suffer credit-wise for 7 years and celebrate their 30th birthday completely debt-free without ever paying a dime of the loans?
Re: The $555,000 Student-Loan Burden
#4"Dr. Bisutti says she loves her work, but regrets taking out so many student loans. She admits that she made mistakes in missing payments, deferring her loans and not being completely thorough with some of the paperwork, but was surprised at how quickly the debt spiraled." ... "After completing her fellowship in 2007, Dr. Bisutti juggled other debts, including her credit-card balance, and was having trouble making he…
Be VERY careful what you wish for. The fact that student loans are not dischargable directly contributes to increasing their availability and reducing the interest rate charged. (By dramatically reducing the risk of default.) Otherwise, why wouldn't someone just run up $300K, declare bankruptcy the day they graduate, suffer credit-wise for 7 years and celebrate their 30th birthday completely debt-free without ever pa…
But there is the other side: schools have less restraint on raising tuition. If the government is giving out loans like candy, schools don't mind hiking the tuition higher and higher every year (well beyond the level of inflation).
I noticed that with my school. I was in graduate and under-graduate school at the same university. I was there for 7 years. The tuition kept going up at an enormous pace and the school just stared building stadiums, shopping areas, recreation centers and other seemingly useless stuff. Incoming students and their parents had to take higher and higher loans.
I graduated without any loans and we payed my wife's loans in 2 years but that is definetly not the norm.
Producing graduates that are enslaved to paying back giant loans makes less able to competitively choose work places (they can't quit a job they don't like as easily because they have to keep paying another, rather large monthly bill).
Re: The $555,000 Student-Loan Burden
#5Earlier quoted context omitted.
Be VERY careful what you wish for. The fact that student loans are not dischargable directly contributes to increasing their availability and reducing the interest rate charged. (By dramatically reducing the risk of default.) Otherwise, why wouldn't someone just run up $300K, declare bankruptcy the day they graduate, suffer credit-wise for 7 years and celebrate their 30th birthday completely debt-free without ever pa…
But there is the other side: schools have less restraint on raising tuition. If the government is giving out loans like candy, schools don't mind hiking the tuition higher and higher every year (well beyond the level of inflation). I noticed that with my school. I was in graduate and under-graduate school at the same university. I was there for 7 years. The tuition kept going up at an enormous pace and the school jus…
Agreed, the whole thing is a death spiral separating the population...
Easy loans lead to higher tuition... ...higher tuition leads to more debt on graduation... ...more debt on graduation leads to a need for a higher salary... ...the need for a higher salary increases the prices companies charge for goods and services delivered by college educated...
A prime example everyone is familiar with is the rising cost of healthcare.
If this continues we're going to stratify the income in the US so far we'll end up with an aristocratic and peasant class of citizens and the only way the non-college educated peasants will be able to live is through indentured servitude to a "lord or lady".
Re: The $555,000 Student-Loan Burden
#6Earlier quoted context omitted.
But there is the other side: schools have less restraint on raising tuition. If the government is giving out loans like candy, schools don't mind hiking the tuition higher and higher every year (well beyond the level of inflation). I noticed that with my school. I was in graduate and under-graduate school at the same university. I was there for 7 years. The tuition kept going up at an enormous pace and the school jus…
Agreed, the whole thing is a death spiral separating the population... Easy loans lead to higher tuition... ...higher tuition leads to more debt on graduation... ...more debt on graduation leads to a need for a higher salary... ...the need for a higher salary increases the prices companies charge for goods and services delivered by college educated... A prime example everyone is familiar with is the rising cost of he…
Isn't that already the case?
Just replace "lord or lady" with the name of a large multi-national corporation (Wal-Mart for example).
Re: The $555,000 Student-Loan Burden
#7This is making me think twice about taking out student loans to go back and get a BS next spring. I truly doubt that I would be able to, cognitively, work and study at the same time - one of the two would suffer.
Re: The $555,000 Student-Loan Burden
#8Earlier quoted context omitted.
Agreed, the whole thing is a death spiral separating the population... Easy loans lead to higher tuition... ...higher tuition leads to more debt on graduation... ...more debt on graduation leads to a need for a higher salary... ...the need for a higher salary increases the prices companies charge for goods and services delivered by college educated... A prime example everyone is familiar with is the rising cost of he…
Isn't that already the case? Just replace "lord or lady" with the name of a large multi-national corporation (Wal-Mart for example).
[deleted]
Re: The $555,000 Student-Loan Burden
#9This is making me think twice about taking out student loans to go back and get a BS next spring. I truly doubt that I would be able to, cognitively, work and study at the same time - one of the two would suffer.
Go to another country/state where education is a significantly cheaper? Europe maybe?
Re: The $555,000 Student-Loan Burden
#10Earlier quoted context omitted.
But there is the other side: schools have less restraint on raising tuition. If the government is giving out loans like candy, schools don't mind hiking the tuition higher and higher every year (well beyond the level of inflation). I noticed that with my school. I was in graduate and under-graduate school at the same university. I was there for 7 years. The tuition kept going up at an enormous pace and the school jus…
Agreed, the whole thing is a death spiral separating the population... Easy loans lead to higher tuition... ...higher tuition leads to more debt on graduation... ...more debt on graduation leads to a need for a higher salary... ...the need for a higher salary increases the prices companies charge for goods and services delivered by college educated... A prime example everyone is familiar with is the rising cost of he…
Very good description, and I'd even say there are some problems missing from it. Actually, increased salary demands due to student loan balances lead to:
- exacerbated income disparity, since only the elite are hired, which makes the job market extra-tough on all but the most capable new graduates, as well as
- higher professor salaries, since professors and potential professors in the field have attractive non-academic options, but also
- more willingness of students to take on more easy loans, since "everyone knows" that lawyers, etc. make so much money that it's okay to take on a lot of debt.