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Soaring Student Debt Prompts Calls for Relief

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Re: Soaring Student Debt Prompts Calls for Relief

#71

Post by jrs235 »

maxerickson wrote: post #18
tswartz wrote: post #15

Earlier quoted context omitted.

Yeah that's a very good point. Interesting how they aren't easily discharged via bankruptcy. I may have to do some research on how exactly that got put in place and who was behind it...

It got put into place because they are high risk loans given out to people that have nothing to secure them with. If you could discharge them in bankruptcy, no one would offer them because huge percentages of people would go ahead and do so.

I believe two Georgetown law students were the ones that exposed the hole. They took out loans for their law degrees, $xxx,xxx dollars in loans and then tried filing for bankruptcy to get a "fresh start" with no debt out of school. The court said no and refused to let them discharge that debt.

Re: Soaring Student Debt Prompts Calls for Relief

#72

Post by ceejayoz »

jostmey wrote: post #19
NickM wrote: post #13

Earlier quoted context omitted.

> It's bizarre that student debt has become the norm and students who have potentially low-earning majors such as History are still given similar amounts of money from banks as a CS major. Not so bizarre when you consider that student loans are very difficult to get discharged via bankruptcy. The loan issuers don't need to worry so much about whether you'll be able to pay it back or not, because it's more a question…

That's the problem. You add bankruptcy back in and the student loan problem will disappear. Banks will start assessing each person's ability to pay back loans before giving them a lifetime burden of debt. Fix bankruptcy laws, fix the student loan problem.

> Banks will start assessing each person's ability to pay back loans before giving them a lifetime burden of debt.

17-18 year olds often aren't going to have much of a credit score, so you're basically winding up excluding folks from low-income areas/backgrounds from a college education.

Are you going to ban students from changing their major after a few weeks?

Re: Soaring Student Debt Prompts Calls for Relief

#73

Post by n72 »

NikolaeVarius wrote: post #3

If this happens, do I get benefits on the debt I've already paid off? I would be pretty pissed if I didn't. I worked my ass off to pay my loans.

I absolutely understand the sentiment, but if there is legislation to forgive student loans it will not have actually hurt you. In other words, such anger at the forgiveness of student loans really just comes down to envy - namely that other people received a benefit you didn't.

Re: Soaring Student Debt Prompts Calls for Relief

#74

Post by talmand »

douche wrote: post #54
tswartz wrote: post #23

Earlier quoted context omitted.

That ignores risk and also financial burden. If you owe $2k every month to NelNet or another institution, it's much harder emotionally and financially to quit your job to travel the world or start your own company. We had Federal Loans and the interest rate was still 6.5%

> it's much harder emotionally and financially to quit your job to travel the world or start your own company Sorry, I have to laugh. This is the most HN thing I've read today. It's a tremendous privilege to have the option of quitting your job to travel the world, rather than the fear of being arbitrarily laid off, and failing to put food on the table or lose your house. My redneck might be sticking out this morning…

I didn't have student loans, have always had decent paying steady work (except for that time around 9/11), and have never felt financially secured enough to quit a job to travel the world.

I have moved around the country for work quite a bit, so I do feel fairly well-traveled. At least in the continental US.

Re: Soaring Student Debt Prompts Calls for Relief

#75

Post by forrestthewoods »

dv_dt wrote: post #50
forrestthewoods wrote: post #35

Situation: Government guarantees student loans and forbids issuing of loans based on likelihood they'll be bad back. Problem: Schools charge max loan value. Students can't pay them back. Solution: Give away free money. All the government has to do is nothing. Just stop doing things. Stop being involved. The problem will fix itself overnight if they did literally nothing. Le sigh.

The education market won't fix itself because students are not in a sufficiently secure bargaining position where they (collectively) can make an informed decision that corrects the market.

What?

How is the education loan market any different than the automobile or home loan market with respect bargaining position and ability to make an informed decision?

Loan issuers are forced to issue loans without regard to the likelihood those loans will be paid back. Someone seeking a computer science degree from Stanford is treated the same as someone getting an English degree from a 4th tier state school. That's utterly insane.

Re: Soaring Student Debt Prompts Calls for Relief

#76

Post by up_and_up »

tswartz wrote: post #4

It's such a weight off of the shoulders to have paid my wife and my student loans off a few months ago. Instead of the 20 or 30yr plan we put every extra dollar towards it and paid it off in 3.5 years. It feels fantastic! It's bizarre that student debt has become the norm and students who have potentially low-earning majors such as History are still given similar amounts of money from banks as a CS major.

> potentially low-earning majors such as History

FYI, Lloyd Blankfein was a History major, amongst other Billionaires: https://en.wikipedia.org/wiki/Lloyd_Blankfein

It's what you do with the degree.

Re: Soaring Student Debt Prompts Calls for Relief

#77

Post by maxerickson »

dv_dt wrote: post #60
maxerickson wrote: post #30

The typical new graduate owes less than $40,000. The great majority of student debt holders owe less than $30,000. I'd like to see more direct funding for schools and a shift of federal support to competitive grants, but those aren't huge numbers when you look at a degree bringing in hundreds of thousands of extra dollars over a career. Grants aren't as egalitarian as giving anyone who wants it a loan, but they can b…

They may not seem that large, but I suspect that compounding interest effects and the fact that the debt is there very early in peoples lifetimes make them very heavily weighted in terms of the effects on lives and economies.

The interest compounding on a $30,000-40,000 loan wouldn't really be a student loan issue, it would be a job issue.

The interest on the loan sizes I've mentioned is typically going to be less than $4000 a year, so if they pay $6000 a year the loan will go away quite quickly. That's a substantial amount of after tax income for a lot of jobs, but students should be looking at the debt in those sort of terms, that it is going to be one of their main payments for a while.

Re: Soaring Student Debt Prompts Calls for Relief

#78

Post by k-mcgrady »

BenElgar wrote: post #58
k-mcgrady wrote: post #20

Earlier quoted context omitted.

>> Part of the problem is that the last few generations have been told the same thing: blue collar jobs aren't "good" jobs. You need to go to college so you can get a "good" job sitting at a desk because those other jobs are below you. If you take one of those blue collar jobs then you've failed and aren't "achieving your potential". I think another part of it is that even low level office jobs now require some sort…

I think the idea of offering loans only for 'vocational' degrees is extremely damaging. It leads to people taking 'Software Engineering' degrees rather than computer science or maths or physics when really these less directed degrees generally allow people to explore what they are really most passionate about. The idea of a university is not a place where one goes to get a piece of paper that certifies one as compete…

I can see how you thought I was advocating loans for only vocational degrees. Something like Computer Science I think would be fine as a job path is very clear and well paid. I can't speak for Maths of Physics because I don't know much about jobs paths from those. I was more talking about degrees that have no clear job path and which could don't need to be studied at an institution where you are largely paying for the name. If someone wants a loan to study history - fine, give them enough to study in-state or at a community college.

>> university is a place where people should go to learn about things that interest them and inspire them in the company of other like-minded people whilst simultaneously growing as an individual

This is the problem. That all sounds great but it is not worth $100k and there are many other ways to have that experience that do not cost that much.

Re: Soaring Student Debt Prompts Calls for Relief

#79

Post by k-mcgrady »

jinfiesto wrote: post #44
k-mcgrady wrote: post #20

Earlier quoted context omitted.

>> Part of the problem is that the last few generations have been told the same thing: blue collar jobs aren't "good" jobs. You need to go to college so you can get a "good" job sitting at a desk because those other jobs are below you. If you take one of those blue collar jobs then you've failed and aren't "achieving your potential". I think another part of it is that even low level office jobs now require some sort…

I'm skeptical of not allowing loans for degrees that don't lead to jobs. The fact that a statistical argument can be made, like "Only 30% of music majors have jobs out of school" totally obscures the fact that there are causal factors that determine career success out of school. I don't think the issue is degrees that don't lead to jobs. I think much of the issue is people beginning degrees that they have no business…

I can see your point. Let's take music for example seeing as you majored in it and I am also quite invested in it. I can't think of too many music jobs that require a degree. It tends to be an industry where you work hard, from the bottom and learn as you go or you teach yourself. There are legitimate reasons to study it as a degree but are you really getting $60-100k of value from it? Some people might but even a lot of the people prepared to succeed are not going to get that amount of value out of it and likely could have got the information they need for their future through an online course, on the job training, or a community college course.

My main point is that a lot of people are doing degrees when they can get the information they need elsewhere, much cheaper, and they are not getting value for money. Unless we can convince people college isn't something they have to do being more specific about which degree paths get loans is the only way I can see to prevent those people taking out loans they will never be able to pay back.

Re: Soaring Student Debt Prompts Calls for Relief

#80

Post by eatbitseveryday »

talmand wrote: post #74
douche wrote: post #54

Earlier quoted context omitted.

> it's much harder emotionally and financially to quit your job to travel the world or start your own company Sorry, I have to laugh. This is the most HN thing I've read today. It's a tremendous privilege to have the option of quitting your job to travel the world, rather than the fear of being arbitrarily laid off, and failing to put food on the table or lose your house. My redneck might be sticking out this morning…

I didn't have student loans, have always had decent paying steady work (except for that time around 9/11), and have never felt financially secured enough to quit a job to travel the world. I have moved around the country for work quite a bit, so I do feel fairly well-traveled. At least in the continental US.

> well-traveled

At least colloquially, this term signifies one has been to other countries (or better, other continents) and visited other cultures, immersed in other languages, other governments, other ways of eating, etc. One who stays within a country would not (in my opinion) be "well-traveled", despite the country being enormous. My 2cents.

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