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I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

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Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#21

Post by Xcelerate »

ars wrote: post #20
Xcelerate wrote: post #18

I agree completely with her grandmother: > Grandmother: “Why did you borrow money you could not repay?” > Her: “I thought I could repay it until the bailouts happened.” > Grandmother: “That is no excuse. You need to repay them.” For some reason, a lot of people my age lack any sense of personal responsibility. It's not the author's fault she couldn't repay her loans. It's everyone else's. Lately I hear more and more…

You missed her point completely. She IS paying the debt. By defaulting she is stopping the interest from accruing, but she still pays the principal.

Oh, I realize she is paying it. It's just that she shifted the blame of the problem.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#22

Post by chadcf »

stephen_g wrote: post #3

Stories like this make me very glad of the system we have in Australia. You can choose to have your Univertity fees just automatically paid by an interest free loan from the government (it's like a five minute online form to sign up for), and then you just pay back 4% of the loan on each tax return if your salary is over $51,000 (you can choose to make voluntary payments over the compulsory rate, or if you make less…

There's a plan here in Oregon to try and work up a viable system to do this. The idea is called "Pay it Forward" and you would essentially pay a 3% tax for 20 years after you graduate. I'm not entirely sure it will ever come to pass, but it's not a terrible idea IMO. It may not save money, but it does mean you get an automatic income based repayment plan, you can never be in default and you get an automatic deferral when unemployed.

That said, it doesn't really do anything to fix the problem of skyrocketing education costs which is less than idea...

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#23

Post by kator »

Stupid question, if everyone does this do we expect that these loans will still be available?

Maybe it was the "best Decision of (YOUR) Life" but every time this happens it hurts these programs even more.

Congratulations on a perfectly self-centered Millennial decision that was the best decision of your life that most likely made these programs one step closer to being discontinued.

I guess I'm old fashioned, I've never signed something I've not read and I always honor my commitments to the best of my ability and with honor and respect for everyone involved.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#24

Post by tlrobinson »

ars wrote: post #20
Xcelerate wrote: post #18

I agree completely with her grandmother: > Grandmother: “Why did you borrow money you could not repay?” > Her: “I thought I could repay it until the bailouts happened.” > Grandmother: “That is no excuse. You need to repay them.” For some reason, a lot of people my age lack any sense of personal responsibility. It's not the author's fault she couldn't repay her loans. It's everyone else's. Lately I hear more and more…

You missed her point completely. She IS paying the debt. By defaulting she is stopping the interest from accruing, but she still pays the principal.

You missed Xcelerate's point. They're complaining about her attitude. Of course she's paying off her loans, she has to. Student loans typically can't even be wiped away by bankruptcy. If she could I'm quite sure she would.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#25

Post by bradleyjg »

kator wrote: post #23

Stupid question, if everyone does this do we expect that these loans will still be available? Maybe it was the "best Decision of (YOUR) Life" but every time this happens it hurts these programs even more. Congratulations on a perfectly self-centered Millennial decision that was the best decision of your life that most likely made these programs one step closer to being discontinued. I guess I'm old fashioned, I've ne…

The student loan system in the United States has all kinds of negative effects, including being partly responsible for two decades of out of control cost growth in higher education. If a high default rates pushes the government to go back to the drawing board, that's a good thing.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#26

Post by pdonis »

ars wrote: post #19

Sounds like she is defaulting, but paying. The idea of the default is to stop additional interest from being charged. Then pay down the full debt, wait 7 years and done. It's not a terrible strategy actually - although it has some serious drawbacks.

The idea of the default is to stop additional interest from being charged.

But interest being charged was part of the original agreement she made. The fact that she was able to exploit a loophole in the system to avoid paying interest does not make it right.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#27

Post by ahomescu1 »

noisy_boy wrote: post #14

I'm Indian and sometimes pieces like this are a very strong reminder of how bad the student loan situation is in US. I went to a central university (i.e. funded by the central/federal government of India) and basically paid less than INR 1000 per year in tution fees and what not (I was a day scholar so no hostel expenses but they were low as well). For three years of full time university education, that is less than…

Public universities are funded by government, which in turn is funded by taxes. The choice here isn't between "university for a loan" versus "university for free"; the latter choice is actually "university in exchange for an extra 3-5% of taxes for the rest of your life" (I'm guessing that percentage, it might be higher or lower). You have to look at it as "do I want to pay a loan for the next 10 years" versus "do I want to pay 5% more of my salary for the rest of my life". There are up- and down-sides to both options.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#28

Post by pdonis »

ars wrote: post #20
Xcelerate wrote: post #18

I agree completely with her grandmother: > Grandmother: “Why did you borrow money you could not repay?” > Her: “I thought I could repay it until the bailouts happened.” > Grandmother: “That is no excuse. You need to repay them.” For some reason, a lot of people my age lack any sense of personal responsibility. It's not the author's fault she couldn't repay her loans. It's everyone else's. Lately I hear more and more…

You missed her point completely. She IS paying the debt. By defaulting she is stopping the interest from accruing, but she still pays the principal.

But having interest accrue was part of the original agreement she made. The fact that she has exploited a loophole in the system to avoid paying that interest does not make it right. If nobody paid interest on loans, there would be no loans, and she would not have been able to get one to pay for her education.

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#29

Post by marincounty »

I totally understand someone who can't pay back the student loans. But please--try to do it right. Right now student loans are not subject to discharge in bankruptcy court. Before you ruin your credit: obtain as many credit cards as possible. It might take a few years to obtain the amount of credit you need. Then pay off you student loans with their money. Wait awhile--then do your own bankruptcy. (I have no sympathy for credit card companies. They have a lot in common with Loan Sharks.) (One other thing--If you pull off this caper, remember just how terrible you felt when you were in trouble.)

Re: I Defaulted On My Student Loans (And It Was The Best Decision Of My Life)

#30

Post by [deleted] »

kator wrote: post #23

Stupid question, if everyone does this do we expect that these loans will still be available? Maybe it was the "best Decision of (YOUR) Life" but every time this happens it hurts these programs even more. Congratulations on a perfectly self-centered Millennial decision that was the best decision of your life that most likely made these programs one step closer to being discontinued. I guess I'm old fashioned, I've ne…

[deleted]
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