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U.S. forgives 40k student loans

reuters.com

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Re: U.S. forgives 40k student loans

#311

Post by sokoloff »

BitwiseFool wrote: post #182
hunterb123 wrote: post #139

Earlier quoted context omitted.

So since it's only 8% it's fine? How many 8% increments can there be until we're allowed to be against this? I'm against any percentage of funneling taxpayer money to college administrators. Reduce tuition, don't rubber stamp federal loans while letting administrators increase costs.

Student debt is massive, yes, but why are so few people asking where that money actually went? A cursory search says student loan debt is roughly $1.6 trillion dollars and there are around 4,000 to 6,000 colleges/universities. This is a rough number and the actual amount depends on your criteria, but the gist is that you have a ton of money flowing into a relatively small pool. Yes, I know not every dollar of loans g…

Just housing and feeding around 50 million borrowers while they attend school for 4-ish years ends up being a damn lot of money.

Re: U.S. forgives 40k student loans

#312

Post by timssopomo »

tejohnso wrote: post #289
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.

I'm curious to know how these loans became such a political issue. It's unusual to take out a loan and then complain about having to repay it. That's how it is supposed to work. We don't typically reward people for digging themselves into a hole by bailing them out. Unless they're large corporations. We bail them out in certain cases. But I don't think that's a popular idea either.

We do, actually, at least in the US. It's called bankruptcy. We generally recognize that sometimes despite best intentions, debts become unpayable and in these cases, the debts get restructured and creditors are frequently wiped out (which is fair, since both borrower and lender take risks).

Student loans can't be discharged through bankruptcy unless the borrower is permanently disabled. It's entirely possible to end up in default on a loan for a degree you never obtained, paying a loan your entire life, without ever decreasing the principal. Unsurprisingly, this rubs people the wrong way.

Re: U.S. forgives 40k student loans

#313

Post by apetresc »

Miner49er wrote: post #293
apetresc wrote: post #264

One technical question I've never understood about this debate: when the government "forgives" loans like this, what are they actually doing? Is the government paying the creditors off on the debtors' behalf (like a bailout)? Or are they simply declaring a refusal to prosecute the debtors?

The government is the creditor. They just forgive the loan. Probably just 0 out a number in a database somewhere.

Oh, I see - they're all federal loans, got it.

Re: U.S. forgives 40k student loans

#314

Post by twblalock »

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…

Don't reward people who made bad decisions and punish people who made good decisions. That is the opposite of how the world ought to work.

Re: U.S. forgives 40k student loans

#315

Post by jasonlotito »

jeegsy wrote: post #112
_moof wrote: post #27

Please, please, please take note before commenting: These are being forgiven under the Public Service Loan Forgiveness program, created in 2007 (fifteen years ago), which eliminates your remaining debt after you've made ten years of payments while working in the public sector (government or non-profit). This has nothing to do with current debates around loan forgiveness.

What then is the point of the article? To tout something implemented by another administration? I haven't been employed by the taxpayers so who cares?

Comments like these boggle my mind. This is news. This is reporting. Literally taking what is done and sharing it with the masses: X did Y. That's it.

Did you know this happened before this article? No. Does your caring change the fact that it's news? No.

"What's the point of the article?" To inform. That this needs to be questioned is upsetting.

Re: U.S. forgives 40k student loans

#316

Post by Miner49er »

bombcar wrote: post #154
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…

Just to add, the program was a complete failure. 99% of applicants for it were rejected. This news is just that they are trying to fix it, from my understanding.

Re: U.S. forgives 40k student loans

#318

Post by 31098347 »

loeg wrote: post #105
31098347 wrote: post #84

Earlier quoted context omitted.

People who have paid their student loan debt are in exactly the same situation they were after this forgiveness than they were before: that is, they have no student loan debt. People in the US are not punished for being financially responsible. They are rewarded for taking risks, but not punished for being responsible. Very different.

> People who have paid their student loan debt are in exactly the same situation they were after this forgiveness than they were before: that is, they have no student loan debt. You're missing the point, either deliberately or on accident. (Prefacing this with: we should keep and honor the terms of the existing PSLF program that students relied on when taking on debt.) There's no particular reason people with current…

>In fact, a hypothetical student debt forgiveness event like GP was discussing would punish those who responsibly paid off their student debts relative to similar-earning classmates who did not.

Punish how? This word keeps being used but it does not fit any definition of punish I'm familiar with. I'm not being obtuse.

Some background of where I'm coming from: Worked 40+hrs/week for $7.25 to $10/hr from 2005 to 2009 to get a four year degree from a state school. Graduated with $35,000 in student loan debt myself and about $20,000 in debt through Parent Plus loans. My parents sent me some money for rent on occasion, but overall -- that's how I di it.

I also paid off all my student loans, and my parent plus loans.

If someone graduated with $100,000 debt because they partied all the time, didn't work, and tomorrow Biden just gave them a tax-free forgiveness....

I am not punished by this. At all. It has no impact on my life whatsoever. I made the best choice I could make with my circumstances, and I paid off my loans because at the time that was the best way to secure my future. The day before the party-guy got his $100k write-off and the day after, I wake up in the same house, with the same car, with the same job, with the same spouse. My life doesn't change at all.

Re: U.S. forgives 40k student loans

#319

Post by dionidium »

sergiosgc wrote: post #198
commandlinefan wrote: post #152

Earlier quoted context omitted.

> 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…

Student loans should be discharged on personal bankruptcy. All of the other examples you give can be written off like that. Student loans, however, are rarely discharged by judges on those processes.

I'm strongly against student loan forgiveness, but I support this measure. Society offers a life vest in the form of bankruptcy to people who are financially drowning. That's as it should be. No need for new, ad hoc solutions to this problem.

Re: U.S. forgives 40k student loans

#320

Post by dudul »

SSilver2k2 wrote: post #248
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.

I paid off my student loans. My wife has student loans still. If next year all new college students get free tuition I'm not going to be upset that I had to pay. I'm going to be happy that they don't have my burden. We as a society need to push the next generation up, not complain that they don't have it as hard as we do. *Free Tuition = Tuition paid for by our taxes.

How is loan forgiveness doing anything for the next generation?

Fixing the current shit show that is college tuition/loan is a completely different problem from the forgiving of existing loans. AFAIK the 1st one has quasi-unanimous support, while the 2nd one is clearly very debatable.

Conflating the two is unproductive.

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