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Nearly 5M Americans in Default on Student Loans

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Re: Nearly 5M Americans in Default on Student Loans

#11

Post by ghostcluster »

whatshisface wrote: post #3
ianai wrote: post #2

In the US people can’t clear student loans in bankruptcy. It’s a shame, I think, given the constant upward tick in tuition and lack of resulting careers. They can even go after the students parents.

Academia is a great example of what happens when you try to create a "market-free" zone: things get abused in unexpected ways while clever rent-seekers embed themselves in incredibly lucrative positions that you never knew you were creating. See: student loans/tuitions, pay-to-read journals (another front page HN topic). The student loan problem is a result of the generalized "prestige economy" that's driving the pro…

> things get abused in unexpected ways while clever rent-seekers embed themselves in incredibly lucrative positions that you never knew you were creating

Don't forget the swelling of superfluous administration roles and salaries, including bureaucratic roles whose entire job entails manufacturing problems to justify the existence of their position. See: campus diversity officers https://www.theatlantic.com/education/archive/2016/09/americ...

Re: Nearly 5M Americans in Default on Student Loans

#12

Post by bradleyjg »

ggm wrote: post #7

Although by inclination what I want to do is rant about the iniquity of this kind of robo-debt in education, instead what I am thinking right now, is this: how does this compare overall to the rate of default in debt for other purposes? how does it compare to car loan debt? mortgage debt? I ask, because debt is the same, except in as much as student debt is in principle seeking a path to be able to repay it. The asse…

The overwhelming majority of student loan debt is government backed and eligible for some kind of income based repayment plan. There are four different kinds, but the most common two use a formula of 10% of income after 150% of the poverty level for the relevant household size. It is entirely possible to have a required payment of $0, before even getting into forbearance or deferral.

Car loans and mortgage loans are not comparable. It's possible to simply be unable to pay those debts. So there's every good reason that the student loan default rate should be lower than those.

Re: Nearly 5M Americans in Default on Student Loans

#13

Post by [deleted] »

nordsieck wrote: post #10
ianai wrote: post #2

In the US people can’t clear student loans in bankruptcy. It’s a shame, I think, given the constant upward tick in tuition and lack of resulting careers. They can even go after the students parents.

> In the US people can’t clear student loans in bankruptcy. It’s a shame... Maybe you could explain this to me, because I really don't understand. Why do you think that it's a shame that people can't just discharge substantial, otherwise unsecured government loans? To me, the real shame is high school employees pushing college on marginal students. One of the few things worse than spending too much money on a not-par…

[deleted]

Re: Nearly 5M Americans in Default on Student Loans

#14

Post by stdntloancmntr »

ggm wrote: post #7

Although by inclination what I want to do is rant about the iniquity of this kind of robo-debt in education, instead what I am thinking right now, is this: how does this compare overall to the rate of default in debt for other purposes? how does it compare to car loan debt? mortgage debt? I ask, because debt is the same, except in as much as student debt is in principle seeking a path to be able to repay it. The asse…

> how does this compare overall to the rate of default in debt for other purposes? how does it compare to car loan debt? mortgage debt?

Great question.

Re: Nearly 5M Americans in Default on Student Loans

#15

Post by anonymous5133 »

ghostcluster wrote: post #11
whatshisface wrote: post #3

Earlier quoted context omitted.

Academia is a great example of what happens when you try to create a "market-free" zone: things get abused in unexpected ways while clever rent-seekers embed themselves in incredibly lucrative positions that you never knew you were creating. See: student loans/tuitions, pay-to-read journals (another front page HN topic). The student loan problem is a result of the generalized "prestige economy" that's driving the pro…

> things get abused in unexpected ways while clever rent-seekers embed themselves in incredibly lucrative positions that you never knew you were creating Don't forget the swelling of superfluous administration roles and salaries, including bureaucratic roles whose entire job entails manufacturing problems to justify the existence of their position. See: campus diversity officers https://www.theatlantic.com/education/…

When I was in school the common trend they had was requiring some foreign language course for ALL students. It was sold with all the traditional rhetoric of making students more well rounded but at the same time you aren't getting more well rounded if you are adding an extra 1 grand to your student loan. It never got implemented though because they didn't have enough budget to implement it.

Mind you, this requirement was in addition to all the existing courses you had to take (40 for a BA degree).

Re: Nearly 5M Americans in Default on Student Loans

#16

Post by danjoc »

This is ruining America's future. That's 5M people who can't even qualify for a car loan now. The penalties for default are punishing. Even bankruptcy isn't a realistic option.

This is ruinous for these people. They'll be in their mid-30s or early 40s before they can pay off. Starting that late to build a nest egg, they'll never recover. There's going to be an entire generation that has no secure retirement plans. It will also be a baby bust. By the time they are stable enough to think about starting families, they'll be biologically incapable to produce. Nobody will be around to fight off invaders. We're seriously toast in 50 years at this rate.

Re: Nearly 5M Americans in Default on Student Loans

#17

Post by DINKDINK »

ggm wrote: post #7

Although by inclination what I want to do is rant about the iniquity of this kind of robo-debt in education, instead what I am thinking right now, is this: how does this compare overall to the rate of default in debt for other purposes? how does it compare to car loan debt? mortgage debt? I ask, because debt is the same, except in as much as student debt is in principle seeking a path to be able to repay it. The asse…

>because debt is the same

No, not all debts are the same: Debts That Cannot Be Discharged in Bankruptcy https://www.thebankruptcysite.org/nondischargeable-debts

Re: Nearly 5M Americans in Default on Student Loans

#18

Post by genzoman »

Before the internet, centralized places of knowledge were needed, and you'd need to attend that place to find said knowledge. Think about how access to music caused the price of albums to drop. Education had not seen a similar dip in cost even though the supply is 100 percent saturated.

There's a dying class of professors who got in while tenure was still a thing that paid probably 1/10 of the cost for education kids are paying now. They have the rosiest glasses possible because they're making around 100k for zero competition in their workspace.

The vast majority of the time now a TA teaches the course or certainly grades the paperwork. Well over half of college degrees obtained will never pay for themselves.

A philosophy, social science or psychology degree are not important enough to pay 50k to get. Free college would be a complete disaster, and a massive waste of money.

The education cartel places liberal , financial shackles on kids who are less than 1000 sunrises away from going to prom. The liberal arts is a complete disaster for young people's financial means. So, you get somebody 100k in debt for something they could learn on the internet and guess what? They'll ALWAYS vote to raise taxes on the rich.

I worked at a state university for five years, doing research. The waste of extravagant, totally unsustainable. I was going to grad school free since I was an employee, dropped out to teach myself software and in four years I make nearly as much as the Phds. in a physical therapy department. All it cost me was time.

Re: Nearly 5M Americans in Default on Student Loans

#19

Post by metilda »

nordsieck wrote: post #10
ianai wrote: post #2

In the US people can’t clear student loans in bankruptcy. It’s a shame, I think, given the constant upward tick in tuition and lack of resulting careers. They can even go after the students parents.

> In the US people can’t clear student loans in bankruptcy. It’s a shame... Maybe you could explain this to me, because I really don't understand. Why do you think that it's a shame that people can't just discharge substantial, otherwise unsecured government loans? To me, the real shame is high school employees pushing college on marginal students. One of the few things worse than spending too much money on a not-par…

Bellevue College might be the biggest, but its far from the best. They tend to hire current UW professors to teach one class a quarter, stuff the rest of the dept with teachers that were able to get canned at the Seattle Colleges and UW satellites, and hope for the best.

Many of my friends who went there have horror stories about their teachers which I'd be hard pressed to encounter at Seattle Central College or North Seattle College.

Nearly every community college in the Puget Sound decided about a decade ago to shed the community branding and add a handful of 4 year degrees. Problem is the material you learn in upper level CS classes at UW and its satellites is quite different than what North Seattle College and Seattle Central College require (eg: a whole class on SQL Server, C# as the Intro CS class at Seattle Central rathr than the state mandated Python, etc).

Re: Nearly 5M Americans in Default on Student Loans

#20

Post by ggm »

DINKDINK wrote: post #17
ggm wrote: post #7

Although by inclination what I want to do is rant about the iniquity of this kind of robo-debt in education, instead what I am thinking right now, is this: how does this compare overall to the rate of default in debt for other purposes? how does it compare to car loan debt? mortgage debt? I ask, because debt is the same, except in as much as student debt is in principle seeking a path to be able to repay it. The asse…

>because debt is the same No, not all debts are the same: Debts That Cannot Be Discharged in Bankruptcy https://www.thebankruptcysite.org/nondischargeable-debts

good point. some debts follow you around for life. And after: my dad always said tax was a gamble, and he decided to ignore the final-demand letters which we found in his office after he died. In one sense, he "won" the bet. In another, viewing him as the tuple {himself, his estate} he didn't...
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