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More Than 40% of Student Borrowers Aren’t Making Payments

wsj.com

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Re: More Than 40% of Student Borrowers Aren’t Making Payments

#91

Post by colemickens »

kdamken wrote: post #13

Not surprising. Lots of kids are holding out hoping that someone will get elected and wave a wand to magically erase the money they borrowed.

"Lots of kids are..."

More like... lots of people are making up absurd statements based on their perception of a political candidate. I don't know of a single, single person who is supporting Bernie because they think he's going to post-defacto erase their college debt. Especially since that's not even something he's ever suggested.

But yeah, I'm sure "lots of kids" are holding out for that. You should've thrown in the swear word "millennials" for true effect.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#92

Post by brokentone »

wehadfun wrote: post #54
igetspam wrote: post #27

My wife is one of these borrowers. She has a master's degree in teaching. It cost her over $100k to get and she can't find job that would pay her enough that she'd be required to pay anything back. I've seen her loan repayment docs and her minimum payment due is $0 every month. While I think her decision to get a masters in education was a bad one (before we were married) I laugh at an institution that would loan her…

Man same situation exactly. We don't get $0 invoices though. What pissed me off is that there is no way the university spend $100K educating her. That money probably went to build some palace with some guys name on it.

Certainly agreed that the dollars going in and out of education don't make a lot of sense to me, but there are cheaper schools. If you don't feel the school is worth the money, go to a school that you do feel is worth the money.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#93

Post by quantum_nerd »

As someone who has been paying upwards of 20% or more of my monthly take home pay to student loans, I am surprised the figure of delinquent payers isn't higher. I count myself one of the lucky ones(CS degree, gainfully employed...) and I have college friends making close to minimum wage, with more students loans than I and struggling to make payments.

Who thought a $25,000/year(and rising) public university education was a good idea ?

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#94

Post by pink_dinner »

We really need to educate students potentially starting college that they shouldn't major in something that pretty much has no chance of ever paying it back. This applies to most liberal arts programs.

A college education is a major investment. It's sad that culturally, our financial education is this poor.

I majored in a science and had all of my debts paid off within 5 years. I have friends that majored in things like history and still haven't paid their debts off after 10 years.

The popular thing to to is blame society, the university, or even high school teachers for recommending someone go to college. But, students need to take personal responsibility for taking out a loan and being unable to pay it back.

When this happens, we will have less students making foolish decisions.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#95

Post by brbsix »

khnd wrote: post #30

it's these 'for profit college' they have to go. i suspect most are total trash. also - with all these coding bootcamps popping up nowdays, im not sure if people are able to get govt student loans for these or what but it sounds like trouble. ppl are desperate to jump on the coding gold rush and the great salaries and job market. ppl are going to get fucked over big time. first time i saw this[0] all kinds of warning…

At least the coding bootcamps are subject to market pressures that keep tuition (and subject matter) within the realm of economic reality. The fact that guaranteed subsidized loans are not available for them is probably of massive benefit.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#96

Post by caseysoftware »

rdtsc wrote: post #47

> The Education Department has assembled a “behavioral sciences unit” to study the psychology of borrowers and why they don’t repay. Ha! There is a bit of a hypocrisy there -- if big banks / companies piss away money and choose to strategically default then (and some even get bail-outs), it is just business. If people do it for whatever reason, well clearly the are immoral, deficient somehow, their psychology needs t…

The reasoning here is simple:

If you think your loans are going to be forgiven, why not stop paying on them? In fact, it's stupid to keep paying them. If I still had student loans, I'd consider the same.

In all honesty, I doubt there's going to be a serious re-evaluation of these programs until the system breaks. There are many degrees that people here consider absurd but there is inertia and programs and efforts to make sure that those are the best protected.

Can you imagine the headlines if a university canceled the "women's studies" degree and shifted the money to something resembling vocational training?

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#97

Post by Rangi42 »

twinkletwinkle wrote: post #70
guelo wrote: post #21

There's a simple solution, the Feds should cutoff loans for schools that don't get their students jobs. The government are the only ones that are able to accurately calculate which schools are completely worthless. In fact they should take it one step further and advertise to the whole world what percentage of students get jobs in their studied field and the average starting salary. That would finally put some market…

Must the value of an education be purely the salary you can get afterwards? The true roots of liberal arts (which used to include everything from astronomy to mathematics to botany) lie in creating a well-rounded, educated, sophisticated person. We can't all study STEM, and we as a society shouldn't demand that.

Not everyone wants or needs to get a well-rounded liberal arts education. The problem is that undergraduate degrees are more and more a prerequisite for getting any job, so there's pressure to make it easy for poorer people to earn a degree. Towards that end we have loans, grants, scholarships, subsidized city colleges and state universities...

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#99

Post by hdctambien »

jff wrote: post #15
badminton1 wrote: post #12

Around the world many institutions use factoring. https://en.wikipedia.org/wiki/Factoring_(finance) This converts receivables into cash by selling them a third party at a discount. This doesn't prevent the educational institutions from getting their cash. Not sure how it works in the US.

The Department of Education sold my loan to a private company within a year or so of graduation. No rate change or anything, I just started logging in on a different web site to pay. Same thing with my wife and with many people I know.

My understanding is that the Department of Education was never servicing your load, they contract that out from the beginning. If your load gets transferred. It happens because one of their contractors "goes away" and all the loans that contractor was servicing need to be transferred to another contractor.

I wouldn't buzz in on Jeopardy with that answer, though.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#100

Post by microcolonel »

sh1ps wrote: post #22

A big takeaway from this article (for me) is that people are surprised that 17 year old kids don't understand what they're doing when they take out that college loan. Shock and astonishment despite there being little to no preparation for this kind of financial understanding previously in their education. That surprise and shock shocks and surprises me. Honestly it kind of reminds me of the whole Yelp minimum wage th…

I know more about managing debt than most 30 year olds, and I did when I was 17. I think it's just a matter of interest in understanding it; and also people's inability to come to terms with the fact that they can't actually afford the things they're buying.

For what it's worth, I never did go to University or College; never planned on it. I wouldn't understand the motivation for it.

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