White House rolls back protections for people in default on student loans
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Re: White House rolls back protections for people in default on student loans
#2It doesn't matter if it was a nice idea but if it was adopted outside the normal and proper means of adopting regulations then it is not okay. Forms of action matter regardless of the desirability of the substance. However, nothing prevents this being adopted again in the proper fashion under the Administrative Procedures Act.
Re: White House rolls back protections for people in default on student loans
#3This is probably a good idea. It's ridiculous that we coddle people who wastefully took out loans with the goal of improving human capital, and then failed to take advantage of them.
Previously student loans were a socialized losses, privatized gains situation. This gives borrowers some skin in the game and will hopefully give them more reason to carefully evaluate whether college is really a good idea for them.
Re: White House rolls back protections for people in default on student loans
#4The actual protection being rolled back:
"That [protection] forbid the agencies from charging fees for up to 16 percent of the principal and accrued interest owed on the loans, if the borrower entered the government’s loan rehabilitation program within 60 days of default."
Re: White House rolls back protections for people in default on student loans
#5After a few years of unemployment and being treated for bipolar depression my loans were in default. Due to the grace of the system at the time, I was able to bring my loans out of default and I now pay them like everyone else. This type of thing punishes the downtrodden even more. There must be a set of checks and balances that at least attempts to differentiate between deadbeats and broke people that don't need a higher hill to climb. The loans never go away. You can't escape them with bankruptcy. Let's not make this a living hell for people that got educated and fell on hard times.
Re: White House rolls back protections for people in default on student loans
#6This is probably a good idea. It's ridiculous that we coddle people who wastefully took out loans with the goal of improving human capital, and then failed to take advantage of them. Previously student loans were a socialized losses, privatized gains situation. This gives borrowers some skin in the game and will hopefully give them more reason to carefully evaluate whether college is really a good idea for them.
What? Borrowers already have skin in the game. Lenders have none.
Make student loans dischargeable and suddenly a lot more people are thinking about the actual utility of college and it's costs.
Re: White House rolls back protections for people in default on student loans
#7How far HN has fallen when an intelligent comment like this is downvoted. Yes, I expect mine will be too. I no longer care about the opinions of this community.
Re: White House rolls back protections for people in default on student loans
#8It doesn't matter if it was a nice idea but if it was adopted outside the normal and proper means of adopting regulations then it is not okay. Forms of action matter regardless of the desirability of the substance. However, nothing prevents this being adopted again in the proper fashion under the Administrative Procedures Act.
From the article it sounds like the regulation comes from a court precedent. The court sought advice from the Obama administration. It was not an executive order.
Re: White House rolls back protections for people in default on student loans
#9The actual protection being rolled back: "That [protection] forbid the agencies from charging fees for up to 16 percent of the principal and accrued interest owed on the loans, if the borrower entered the government’s loan rehabilitation program within 60 days of default."
16% interest on student loans is basically usury
Re: White House rolls back protections for people in default on student loans
#10I'm surprised by the comments here. I am a fiscal conservative, but having taken and struggled to pay for student loans, and having hired people in the same situation, find that the lending programs are predatory by nature in that they know students will be unable to service the high monthly payments, and eventually default as a result.
Do I think people should pay their debt? Yes, but these lenders are the same lenders that get bailed out time and time again. They are in no peril. It is our students that assume this risk.
The only reason I was able to pay my loans was because the Army paid them for me after I completed my term of service. I tried for years to find employment that could help me escape a life of poverty but could not. It was not until I left the Army and started my own business that I finally started to claw my way out.
Our education system is broken. We know this. So lets stop punishing kids for doing what they've been told do to throughout K-12, and instead help them find a way out of the rat race. Kids swimming in debt are of no service to this country. We have to do better.