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U.S. forgives 40k student loans

reuters.com

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Re: U.S. forgives 40k student loans

#151

Post by nebula8804 »

buu700 wrote: post #104
loourr wrote: post #12

It's crazy to cancel student loans and still keep issuing the exact same loans. If we believe the loans are unjust then the government should stop handing them out as the very first step.

Exactly. Plug the hole first (or concurrently), and then worry about bailing water. Additionally, as others have mentioned, it needs to be done in such a way that we aren't punishing those who have been responsible and made sacrifices to pay off their loans. I'm not opposed to student loan forgiveness, but I don't think it's nearly as popular as many progressives would like to believe as a standalone proposal. Come u…

I am starting to think this is a sign of a big weakness in the American system. These half baked actions are evident in health care, security, and all other categories. I think it has to do with the fact that there are so many parties acting in bad faith that it is hard to get comprehensive legislation that addresses the problem as a whole vs just piecemeal bits and pieces because that is all that can be pushed through. I don't know what the solution to this is other than a complete reset of the system (which itself would require the existing system to produce and pass)

Re: U.S. forgives 40k student loans

#152

Post by commandlinefan »

InitialBP wrote: post #94
throwaway894345 wrote: post #49

Earlier quoted context omitted.

And also reimburse the people who sacrificed to pay theirs off or avoid them in the first place. I’d donate my reimbursement if they did, but of course they won’t.

Demanding "even-stevens" all the time doesn't help the situation at all. The people that were able to pay off their loan debt were people who chose a degree that would be able to make significant money, were talented enough to land a great job in a field without a lot, or had the circumstances that let them finish a degree where others were unable to. Do some people make bad decisions about degree choice? - Yes Do so…

> people who either have made bad decisions, had less fortunate circumstances than others, or a combination of both deserve to live under a mountain of debt for the rest of their life? - No

Why does this logic only apply to people who made bad decisions and had less fortunate circumstances or a combination of both only apply to people who did so in the context of taking out student loans? If making bad decisions and having less fortunate circumstances is grounds for student loan forgiveness, why isn't it grounds for credit card debt forgiveness? Or home or auto loan forgiveness?

Re: U.S. forgives 40k student loans

#153

Post by vmception »

moralestapia wrote: post #146
vmception wrote: post #137

Earlier quoted context omitted.

This is about a 15 year old program and nothing to do with current political sentiment. Those same people always had the choice of complying with this program as well.

It was a tangential comment and I never mentioned politics, at all. 15 year old program or not, what do citizens who meet all those things I mentioned get in return? Please don't tell me it is "the satisfaction of knowing that their hard work and taxes benefit others who are less fortunate than them" .

I don't view it as getting something in return. They made a choice. The people complying with this other program made a choice. Both choices result in less debt they have to worry about. This leads me to think we're having a different conversation than the one you want to have.

Re: U.S. forgives 40k student loans

#154

Post by bombcar »

swarnie wrote: post #19

I'm not tuned in to American politics so can someone more knowledgeable fill me in... How many more loans are likely to be forgiven? When will people be told to start repaying?

This is mainly a policy called Public Service Loan Forgiveness which says that IF you make 120 payments on schedule and on time (ten years) AND you work during that time for a qualified 'public service' job (think government, teacher, non-profit) THEN after 10 years the government will pay the remainder of your loan.

There's some other stuff but the majority of it is that, a policy that's been in place for many, many years, but has been a bureaucratic hell to correctly navigate (you need to check each year, perhaps each month, that your payment has been recorded correctly, and reported correctly, etc).

This is not general loan forgiveness by a long shot.

Re: U.S. forgives 40k student loans

#156

Post by mrep »

throwawayboise wrote: post #100
honksillet wrote: post #46

Earlier quoted context omitted.

End federal involvement in student loan and allow student loan debt to be discharged in bankruptcy. Problem solved.

This is the answer. Lenders would then have to do proper qualification on borrowers, would be more limited in their lending, and this would put downward pressure on tuition.

So unsecured personal loans? Those depend on your credit which most students don't have much/any and your debt-to-income which is normally infinite for students because they don't work. You would massively screw over kids whose parents cannot pay/co-sign a normal loan as it would force them to work and study. Also, you normally cannot get very much with such low income and cherry on top, they have awful interest rates which range from about 6% to 36%. The APR on loans for borrowers with excellent credit is around 12%; it's about 29% for bad credit borrowers which students with no credit are likely to be.

As an example: say you work at target for 2 8 hour days on the weekend making 15 an hour and with a 36% debt-to-income ratio limit, you could afford a payment of $374.4 a month. $15,000 punched in a 30 year repayment at 29% interest rate equals a $362.57 payment. So you might be able to do it but I would hate to be working every single day between weekend work and weekly school and that is assuming an entire 4 year degree could be pushed to to $15,000.

Re: U.S. forgives 40k student loans

#157

Post by janejeon »

buu700 wrote: post #104
loourr wrote: post #12

It's crazy to cancel student loans and still keep issuing the exact same loans. If we believe the loans are unjust then the government should stop handing them out as the very first step.

Exactly. Plug the hole first (or concurrently), and then worry about bailing water. Additionally, as others have mentioned, it needs to be done in such a way that we aren't punishing those who have been responsible and made sacrifices to pay off their loans. I'm not opposed to student loan forgiveness, but I don't think it's nearly as popular as many progressives would like to believe as a standalone proposal. Come u…

Could it be possible that this is being done more as a way to garner votes for the midterms? Someone else commented that this affects like only a tiny fraction of people w/ student loan, but it does make for a good headline, judging by the number of comments here.

Re: U.S. forgives 40k student loans

#158

Post by Invictus0 »

bombcar wrote: post #138
musicale wrote: post #85

Earlier quoted context omitted.

It's an insane system that has enabled universities to drastically increase tuition and fees, outpacing inflation for more than half a century.

US: We should use the power of our massive government to subsidize and guarantee 30 year fixed home mortgages. House prices: shoot up US: Surprised pichachu face US: We should use the power of our massive government to subsidize and guarantee loans for college education so people can afford houses! College prices: shoot up US: Surprised pichachu face

Let's do healthcare now

Re: U.S. forgives 40k student loans

#159

Post by sevenf0ur »

chao- wrote: post #114
lifeisstillgood wrote: post #26

I know every European seems to ask this of every American but what is the resistance to a welfare state? if you look at a government as investing in its citizens like a VC fund, then providing education and medical care is sensible, and some will turn out fine and others will be Bezos and then you can get your investment back via tax. I am honestly trying to avoid the flame war here - but I do it know how else to fra…

As many liberal policy wonks (not a pejorative) will point out: the American people love their welfare benefits! A common claim is that "A majority of Americans support $POLICY! It polls so well!", wherein $POLICY is broadly a sub-component of "welfare state". I sometimes hear it said with an undertone of exasperation: Why can't policies that are so self-evidently popular get enacted into law? The challenge isn't get…

> As for why that perception came to be?

This article is about a government program managed so terribly, they did not keep track of payments. You had to call in and trigger a review to be forgiven. These 40k loans forgiven are essentially the lowest hanging fruit.

Re: U.S. forgives 40k student loans

#160

Post by PragmaticPulp »

throwaway894345 wrote: post #49
loourr wrote: post #12

It's crazy to cancel student loans and still keep issuing the exact same loans. If we believe the loans are unjust then the government should stop handing them out as the very first step.

And also reimburse the people who sacrificed to pay theirs off or avoid them in the first place. I’d donate my reimbursement if they did, but of course they won’t.

> And also reimburse the people who sacrificed to pay theirs off or avoid them in the first place.

Most of the loans in this specific program were forgiven in exchange for at least 10 years of specific public sector jobs. Those jobs usually come with a reduced compensation in exchange for the loan forgiveness.

I have a few friends who went this route as lawyers because they prefer helping out in the public sector instead of doing corporate lawyering stuff or the other options.

They definitely did not come out financially ahead by going this route, even with the massive loan forgiveness.

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