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White House rolls back protections for people in default on student loans

washingtonpost.com

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Re: White House rolls back protections for people in default on student loans

#111

Post by codexon »

artursapek wrote: post #19

I keep seeing people say that the student loan crisis will be the next "bubble pop". It seems like colleges and lenders both got greedy and created a mass of debt to them that will never be paid off. That, and I imagine the current generation will send their own kids to college at a much lower rate than their parents did. The "college bubble" is going to pop.

I'm trying to think about how one can profit from this bubble popping through the stock market but I just don't see it really popping. You can't really default on student loans and the government can garnish your wages.

Re: White House rolls back protections for people in default on student loans

#112

Post by jsmeaton »

aianus wrote: post #72
cromwellian wrote: post #53

Costs of increased military spending in Trump's budget: $54 billion Estimated costs to make college tuition free for every citizen: $62 billion

> Estimated costs to make college tuition free for every citizen: $62 billion How? There are ~20 million Americans enrolled in college so $62 billion is only $3,000 per person. In comparison, the US spends about $12,000 per year per high school student.

I'm not disagreeing, but presumably at least some portion of those expenses would be paid back in some way. The Australian model has the government provide the student loan. The interest rate is fixed to CPI and repayments are garnished directly from salary provided you earn over a certain amount (something like 50k). Students also get discounts via copaying which was about $500 per year from memory.

The government obviously never breaks even directly from this scheme. I think they've begun to exclude certain degrees that don't have good prospects which is a big debate at the moment.

Re: White House rolls back protections for people in default on student loans

#113

Post by shiven »

PKop wrote: post #38
nhangen wrote: post #10

I'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 lend…

Removing loan guarantees, and forcing students to scrutinize the value of the degree they are pursuing will improve the problem of students blindly doing what they've been told to do. If they don't suffer the consequences of buying a useless degree, why wouldn't they keep doing it? Any possible improvement of the status quo is going to involve pain. Certainly universities themselves could start feeling some of it, as…

If they don't suffer the consequences of buying a useless degree, why wouldn't they keep doing it?

Why shouldn't the lender also assume part of this risk?

Why is their recoupment guaranteed (student loans can't be dissolved in bankruptcy)?

Why are they always likely to be bailed out (prove me wrong by showing a student loan lender that went into bankruptcy)?

Lenders need to do more due diligence and stop lending to students that are more likely to have problems with payback. The entire liability should not be assumed by the borrowers and co-signers.

Re: White House rolls back protections for people in default on student loans

#114

Post by Mithaldu »

jimmaswell wrote: post #104
nhangen wrote: post #10

I'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 lend…

My reading of the explanations on studentloans.gov was that the standard payment was a minimum of $50/month, and that it could be even lower on an income based plan, is that wrong? Was your minimum higher?

If it's anything like the office i encountered in my life, the minimum is always how high they think you can afford, regardless of how low they could technically go, regardless of whether that means they get nothing.

Re: White House rolls back protections for people in default on student loans

#115

Post by x0x0 »

brianwawok wrote: post #81
x0x0 wrote: post #50

Earlier quoted context omitted.

Yes, it's a good idea to take eighteen year olds (that have been told their whole lives that they should go to college) and push them make decisions whose negative consequences we never allow them to escape.

They do that every day on their own. They decide to smoke or not. Many choose to drink and drive. By 18 you easily have the power to ruin your life, or those of others. At 16 even, not the uncommon to see a 16 year old in the news for running over someone. I propose we give them more information. Perhaps not the end all be all, but at least give them a hope to make a smart decision.

Just make the loans dischargeable in bankruptcy and the problem will sort itself.

ps -- none of your supposed similar items are widely endorsed by teachers/society/parents.

Re: White House rolls back protections for people in default on student loans

#116

Post by dragonwriter »

x0x0 wrote: post #115
brianwawok wrote: post #81

Earlier quoted context omitted.

They do that every day on their own. They decide to smoke or not. Many choose to drink and drive. By 18 you easily have the power to ruin your life, or those of others. At 16 even, not the uncommon to see a 16 year old in the news for running over someone. I propose we give them more information. Perhaps not the end all be all, but at least give them a hope to make a smart decision.

Just make the loans dischargeable in bankruptcy and the problem will sort itself. ps -- none of your supposed similar items are widely endorsed by teachers/society/parents.

They are dischargeable in bankruptcy, but the requirements for discharging them are more difficult to meet than those for other unsecured debt.

Re: White House rolls back protections for people in default on student loans

#117

Post by dragonwriter »

PKop wrote: post #38
nhangen wrote: post #10

I'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 lend…

Removing loan guarantees, and forcing students to scrutinize the value of the degree they are pursuing will improve the problem of students blindly doing what they've been told to do. If they don't suffer the consequences of buying a useless degree, why wouldn't they keep doing it? Any possible improvement of the status quo is going to involve pain. Certainly universities themselves could start feeling some of it, as…

> If they don't suffer the consequences of buying a useless degree, why wouldn't they keep doing it?

Degrees aren't like, say, sodas or toilet paper rolls, a frequently repeated purchase, in any case.

Re: White House rolls back protections for people in default on student loans

#118

Post by oniMaker »

dang wrote: post #12
oniMaker wrote: post #7

How 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.

You've posted like this repeatedly but all it does is make the site even worse, so please don't. We detached this comment from https://news.ycombinator.com/item?id=13903065 and marked it off-topic.

You're just another censoring gatekeeper.

Re: White House rolls back protections for people in default on student loans

#119

Post by eli_gottlieb »

Kluny wrote: post #44
brianwawok wrote: post #36

Earlier quoted context omitted.

> 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. Okay, so then I must ask: What did you major in, what was your total debt, and did you research the career prospects of your major BEFORE going to college? Sometimes I think a basic mandatory form that c…

That would be a great idea. Universities won't do this unless they're legally required to. Student ignorance drives their business model.

They're universities. They don't have a business model. They're not businesses. Their job is to teach and to research, not to make a profit.

Re: White House rolls back protections for people in default on student loans

#120

Post by ryanmaynard »

AlexCoventry wrote: post #109
neves wrote: post #67

This USA student loan scheme is one of the most brilliant machines of social control ever devised. People get of college already owing a lot money, now they have to work for shit, and put up with their asshole bosses do. They can't have the option to spend couple of months searching for jobs or they will have to default their debt and mess all their future life. Nothing like a well behaved society where the workers c…

"...a cynic might argue that we haven't really abolished slavery; we've just relabeled it. The cynic would have a point: an ancient Greek would certainly have seen the distinction between a slave and an indebted wage laborer as, at best, a legal nicety." https://books.google.com/books?id=lliTBQAAQBAJ&pg=PT275

Thank you for the citation; I've ordered the book. Would you happen to have any other book recommendations on the topic, or adjacent topics?
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