More Than 40% of Student Borrowers Aren’t Making Payments • Hacker News Board

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

#381

Post by douche » Thu, Apr 07, 2016, 8:37 AM UTC

prostoalex wrote: post #210

dv_dt wrote: post #194

I this comes out of the flawed meme of private enterprise efficient/gov't inefficient. Thought it's true in some areas, in the area of funding education in society, it's terrible. The loans push money to unsophisticated buyers (kids and their parents), who use it to make a huge amorphous transaction which is only performed once in their lives and plays out over years. There's insufficient buyer information to provide…

That strategy seems to work for Year 1, but what happens when (a) universities expand to cover this newly created demand, thus requiring larger budgets, (b) people enroll only to find out that the classes they are interested in are full? To quote http://www.theatlantic.com/magazine/archive/2015/05/the-upwa... "When it comes to college, the central challenge for most Americans in the 21st century is not going; it’s fi…

Community colleges are, in many places, already straining at their capacity. I know a large number of people that I graduated high school with who got sort of bait-and-switched by the local community colleges - they enrolled in a program, then it turned out that there weren't enough slots in that program, so the community college said, "Here, take your core classes this semester, we'll fit you in next time." Then next semester, the classes they needed to take the previous time aren't offered, so they do more useless "core" classes.

Maybe the second year they get into some of their original program courses, but now they are slated for at least a third year, because they can't take their 2nd year fall courses (in their 2nd year), before they take the 1st year fall and spring courses they got squeezed out of.

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

#382

Post by douche » Thu, Apr 07, 2016, 8:42 AM UTC

josephjrobison wrote: post #189

Wondering if it would help at all if the parents saved up enough for each kid to fully fund their private college, and then when the kid hits high school tell them - when you graduate, you'll get $50k/yr towards your college. If you go to a private school it will cover it, but not leave much. If you go to a good public school, the extra $20k/yr is yours. If you get a full ride scholarship, the $50k/yr is all yours. W…

Save money for college, and most schools will just take that directly off the top of your financial aid package...

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

#383

Post by makomk » Thu, Apr 07, 2016, 8:52 AM UTC

AJ007 wrote: post #42

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…

A big problem is that at age 17, all of the adults are saying go to college & take out these loans. Guidance councilors, teachers, parents. The most compliant high schoolers will just do what they are told without thinking about it further. I imagine this will start changing. When I was a kid, that group of adults had the benefit of cheap degrees. Today, now that group of adults is us and we did not go to school chea…

I believe some US high schools were even holding mandatory-to-attend collage finance classes that were actually paid-for hard sell marketing events by commercial banks for their student loans.

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

#384

Post by PeterisP » Thu, Apr 07, 2016, 9:11 AM UTC

ethanbond wrote: post #299

pmiller2 wrote: post #78

Earlier quoted context omitted.

> A big problem is that at age 17, all of the adults are saying go to college & take out these loans. Guidance councilors, teachers, parents. The most compliant high schoolers will just do what they are told without thinking about it further. > I imagine this will start changing. When I was a kid, that group of adults had the benefit of cheap degrees. Today, now that group of adults is us and we did not go to school…

When people make this kind of assessment they seem to be implying that because a college education is less surefire than it used to be, that it's useless. This is demonstrably false, and a college education is still the best bet a person can make on his or her future. In the same breath people say "all our manufacturing jobs went to China" and "why not go to a vocational school and pick up welding?"

Are you really sure that "a college education is still the best bet a person can make on his or her future" ?

College education has quite a lot of worth, but that worth is much less than it used to be and the price is much more than it used to be.

A degree that has some value is useless if obtaining it costs you twice as much as that value.

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

#385

Post by jld89 » Thu, Apr 07, 2016, 9:16 AM UTC

letitgo12345 wrote: post #66

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 TARP bailout was not money just handed out to banks. It was loans to banking and other industries which was repaid in full overall. And in fact it was the auto industry which failed to repay the loan, not the banking industry. I'm not a fan of the financial sector but let's keep the facts straight here

Oh please... paying back with little to no interest means it was a government handout.

The banks got rich using that money (giving loans with that money at much higher interest of what they were paying the government, it was a bonanza for them), the taxpayers money at the expense of the middle class.

So yes, let's keep the facts straight here.

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

#386

Post by EliRivers » Thu, Apr 07, 2016, 9:17 AM UTC

Spooky23 wrote: post #237

pmiller2 wrote: post #159

Earlier quoted context omitted.

I'm a software engineer now. I majored in math. I've literally had recruiters tell me they couldn't offer me an interview because I didn't study "computers," including once at a college career fair. I wanted to tell that woman about the people who invented computers, but I held my tongue as she threw my résumé back at me.

I work in a big beauraucric .gov. We had a guy who majored in robotics and was one of the best programmers hired in some time. (Iirc, he had some health challenges that made getting underpaid attractive) He got demoted to some horrible computer operator position because an audit of HR revealed his degree, and the auditors found that robotics wasn't computer sciencey enough. The union grieved it and he was eventually…

God bless the union. Exactly the kind of thing they're for.

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

#387

Post by makomk » Thu, Apr 07, 2016, 9:25 AM UTC

tonyedgecombe wrote: post #367

moistgorilla wrote: post #333

Earlier quoted context omitted.

So the UK is basically subsidizing worthless degrees.

Yes, the UK has an obsession with pushing out more graduates, meanwhile we have to import trades people because demand isn't being met.

The Government is (pretending to) do something about this - we've had a huge increase in "apprenticeships", but a lot of those are just shops counting their shelf-stackers as apprentices because it means they don't have to pay the minimum wage.

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

#388

Post by santa_boy » Thu, Apr 07, 2016, 9:25 AM UTC

robbiet480 wrote: post #4

To everyone complaining about the paywall, try hitting the "web" link at the top of this page (to the left of the story comments link)

Thank you. This works for me.

Deviation: But why does this technique work? Any idea what is happening in the background that this article becomes readable on clicking the Google link?

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

#389

Post by justaaron » Thu, Apr 07, 2016, 9:49 AM UTC

jdminhbg wrote: post #355

erichocean wrote: post #146

Earlier quoted context omitted.

> 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. Student loans are the only legal way to sell yourself into "debt slavery"[0] in the United States. It's not the 17 year olds that are screwing up, it's society as a whole by even allowing this situation to exist. [0] https://en.wikipedia.org/wiki/Debt…

> Student loans are the only legal way to sell yourself into "debt slavery"[0] in the United States. Do you mean that student loans are the only legal way to attain a loan whose collateral is your future earnings potential? Because if so that's very wrong.

no, the poster meant that student loans are the only kind of loans that are NOT dischargeable through bankruptcy. literally. look it up.

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

#390

Post by netsharc » Thu, Apr 07, 2016, 10:10 AM UTC

cmurf wrote: post #336

AJ007 wrote: post #42

Earlier quoted context omitted.

A big problem is that at age 17, all of the adults are saying go to college & take out these loans. Guidance councilors, teachers, parents. The most compliant high schoolers will just do what they are told without thinking about it further. I imagine this will start changing. When I was a kid, that group of adults had the benefit of cheap degrees. Today, now that group of adults is us and we did not go to school chea…

Well it's a bit more nuanced isn't it? - Oh of course you're going to college, only losers don't go to college. + But I have to take out loans. - Yep, par for the course. So you're getting peer and parental pressure to get higher education, and in effect make a pretty questionable business decision: it's effectively a modern version of indentured servitude.

Tell them to go to a European university. It's almost free, a lot of countries offer courses in English, they get to see Europe, and even if the living costs are higher, it's not going to be 6 digits expensive/they'd get an education plus a few years adventure for that money.