Students refuse to pay back loans to failed for-profit college • Hacker News Board

Re: Students refuse to pay back loans to failed for-profit college

#81

Post by ics » Tue, Feb 24, 2015, 4:45 PM UTC

33W wrote: post #74

jgrowl wrote: post #60

Earlier quoted context omitted.

I live in the US and was able to go to college almost for free. There were a few caveats though: 1. I waited until I was 24. This meant that my parents income did not affect my federal assistance so that I could get the maximum amount. 2. I went to a dirt cheap community college my first two years. It was so cheap that the federal grants covered my tuition, books, plus a little extra for living expenses. 3. I did rea…

Isn't there a conflict between points 1 and 5? Claiming to be an independent student while living at home?

You can't be claimed as a dependent at age 24.

> To meet the qualifying child test, your child must be younger than you and as of the end of the calendar year, either be younger than 19 years old or be a student and younger than 24 years old. There is no age limit on claiming your child as a dependent if the child meets the qualifying relative test.

http://www.irs.gov/Help-&-Resources/Tools-&-FAQs/FAQs-for-In...

Re: Students refuse to pay back loans to failed for-profit college

#82

Post by ashark » Tue, Feb 24, 2015, 4:46 PM UTC

33W wrote: post #74

jgrowl wrote: post #60

Earlier quoted context omitted.

I live in the US and was able to go to college almost for free. There were a few caveats though: 1. I waited until I was 24. This meant that my parents income did not affect my federal assistance so that I could get the maximum amount. 2. I went to a dirt cheap community college my first two years. It was so cheap that the federal grants covered my tuition, books, plus a little extra for living expenses. 3. I did rea…

Isn't there a conflict between points 1 and 5? Claiming to be an independent student while living at home?

It's a technicality. Once you age out you're "not a dependent" for the purposes of educational subsidies/loans.

Getting married has a similar effect, or at least it used to. You could get married, live with one or the other's well-off parents or otherwise be supported by them, but go to school for free or nearly so. Obviously, that's not for everyone :-)

Re: Students refuse to pay back loans to failed for-profit college

#83

Post by michaelt » Tue, Feb 24, 2015, 4:48 PM UTC

DasIch wrote: post #62

iopq wrote: post #33

Earlier quoted context omitted.

To pay for someone's education someone else must be taxed. Why is it better to tax a working person for every student's education instead of just having that person pay for the exact education they received?

People with university education tend to have higher incomes and in countries with sane laws therefore pay more in taxes. On average they will pay more than they get from government. Apart from that I feel much more comfortable going to a doctor, knowing that she has gained that position by skill and not because her parents could afford it.

Some graduates go on to pay more tax, others don't. The question is do we want our doctors/bankers be taxed more to pay for the education of our sport scientists/elementary school teachers?

Re: Students refuse to pay back loans to failed for-profit college

#84

Post by [deleted] » Tue, Feb 24, 2015, 4:51 PM UTC

vinceguidry wrote: post #78

smtddr wrote: post #71

Earlier quoted context omitted.

I'm very confident that the laziness-factor accounts for less than 25% of the people out there when it comes to student-debt. Afterall, they had the discipline to go to school and get that degree. But like I said, this debate shouldn't even be happening. College & University should just be free to everyone. No line needs to be drawn in that situation.

Confident, eh? You're going to still be that confident once it becomes known that all you have to do to get the government to give you $X0,000 is to say your education was worthless?

[deleted]

Re: Students refuse to pay back loans to failed for-profit college

#85

Post by ChainsawSurgery » Tue, Feb 24, 2015, 4:53 PM UTC

existencebox wrote: post #80

ChainsawSurgery wrote: post #55

Earlier quoted context omitted.

That's awesome! Congratulations. Financial discipline is definitely a nice side effect of this mess - sink or swim, as it were. That being said, frugality is also not necessarily great for the economy =). It's obviously a fantastic idea for individuals, and you're much better off the way you are - on the whole though, we want people to be spending money on goods and services. Sorta like how college is a great idea fo…

An honest question about that; since I've heard the "we need people to spend money" a lot, and for the most part think I understand and agree. However, even if someone saves, (especially if they save via wealth growers like investments to counter inflation) that money doesn't just go into the ground with them when they die. I'd assume the majority of it does go to pay out goods and services in the future, probably ne…

Aha:

> I'd assume the majority of it does go to pay out goods and services in the future, probably nearer to the end of life

Most of those expenses involve healthcare, which is probably not a sector of the economy that needs to see more money right now. You typically want to encourage diverse spending to avoid concentrating money in just one segment of the economy (the ol "dont put all your eggs in one basket" rule).

> that money doesn't just go into the ground with them when they die.

No, it doesn't need to - much of it can go onto next of kin, though, which encourages generational wealth that you typically dont want to encourage too much (which to our benefit, we do somewhat through things like estate taxes).

Additionally, and I have absolutely no reasoning behind this one at all, but spending in such a way lends itself to be extremely susceptible to age demographics: if you have a glut of older people (like we do now with baby boomers) then your economy might do fantastic if everyone spends money at the end of their life.

Conversely, when a low-population generation reaches old age, you're sorta doomed to suffer at that point.

Re: Students refuse to pay back loans to failed for-profit college

#86

Post by smtddr » Tue, Feb 24, 2015, 4:56 PM UTC

vinceguidry wrote: post #78

smtddr wrote: post #71

Earlier quoted context omitted.

I'm very confident that the laziness-factor accounts for less than 25% of the people out there when it comes to student-debt. Afterall, they had the discipline to go to school and get that degree. But like I said, this debate shouldn't even be happening. College & University should just be free to everyone. No line needs to be drawn in that situation.

Confident, eh? You're going to still be that confident once it becomes known that all you have to do to get the government to give you $X0,000 is to say your education was worthless?

Since we're talking hypothetical here; we're never going to convince each other. We can just skip this debate and make College/University free for everyone.

Re: Students refuse to pay back loans to failed for-profit college

#87

Post by awesome_work_ » Tue, Feb 24, 2015, 4:57 PM UTC

mikeash wrote: post #42

Shivetya wrote: post #5

Earlier quoted context omitted.

the aversion to debt isn't occurring very fast considering that outstanding auto load debt is around 886 billion dollars. Credit card debt in 2014 was very similar, with an average of 7k per household. when it comes to school debt the Federal government would be best served by limiting what it loans based on the education desired, as they set limits on what they pay out for medical services there is little reason to…

$886 billion in auto loans doesn't seem like very much to me. There are about 254 million passenger vehicles in the US, so that's an average of $3,500 in debt per car (of course there will be huge variation there). You pretty much need a car to live in many places in this country, and in many more places you need a car to have a decent job. Most people can't afford to buy one outright, and in a case like that, it's s…

I agree with mikeash, and wanted to just add my own personal experience.

Most people I know, and what I also do personally, is buy a used car for less than $10k, and pay it off within 3 years. Then you live with it until it no longer becomes economically viable to keep it.

So my wife and I own our cars at this point, which frees $400+ a month we can put towards something else with the understanding in 2-3 years we will need to budget for cars again.

The basic cycle is 3 years of car debt, 3 years without.

(I don't live in an area which has public transportation)

Re: Students refuse to pay back loans to failed for-profit college

#88

Post by rhino369 » Tue, Feb 24, 2015, 4:59 PM UTC

ashark wrote: post #82

33W wrote: post #74

Earlier quoted context omitted.

Isn't there a conflict between points 1 and 5? Claiming to be an independent student while living at home?

It's a technicality. Once you age out you're "not a dependent" for the purposes of educational subsidies/loans. Getting married has a similar effect, or at least it used to. You could get married, live with one or the other's well-off parents or otherwise be supported by them, but go to school for free or nearly so. Obviously, that's not for everyone :-)

The maximum grant you'll get from the government is about 6k. Anything beyond that is typically the school giving a scholarship or a third party scholarship. And schools typically use a different formula for need aid that doesn't presume you are independent at age 24.

Re: Students refuse to pay back loans to failed for-profit college

#89

Post by yodsanklai » Tue, Feb 24, 2015, 5:07 PM UTC

existencebox wrote: post #80

ChainsawSurgery wrote: post #55

Earlier quoted context omitted.

That's awesome! Congratulations. Financial discipline is definitely a nice side effect of this mess - sink or swim, as it were. That being said, frugality is also not necessarily great for the economy =). It's obviously a fantastic idea for individuals, and you're much better off the way you are - on the whole though, we want people to be spending money on goods and services. Sorta like how college is a great idea fo…

An honest question about that; since I've heard the "we need people to spend money" a lot, and for the most part think I understand and agree. However, even if someone saves, (especially if they save via wealth growers like investments to counter inflation) that money doesn't just go into the ground with them when they die. I'd assume the majority of it does go to pay out goods and services in the future, probably ne…

> I'd assume the majority of it does go to pay out goods and services in the future

I don't know the answer to your question, but my guess it's that people want to make profit now and not in the future.

Digressing a little bit, I made myself the same reflexion concerning fracking. There's a lot of pressure on my country's government to authorize fracking. Supposedly, it would be very beneficial for the economy. However, since this gas isn't going anywhere, i'm not sure why there's such a hurry to get it. Especially considering that it may be cheaper to extract it in the future.

Re: Students refuse to pay back loans to failed for-profit college

#90

Post by simonh » Tue, Feb 24, 2015, 5:08 PM UTC

jobu wrote: post #25

It's odd that they don't mention the reason Corinthian is shutting down so many colleges - http://www.npr.org/blogs/ed/2014/07/08/329550897/the-collaps... A relative of mine works there and said they were about to be sued by the Department of Education over fraud in their student loan department. The settlement forced the company to sell or close all of it's colleges and no senior management or administrative staff i…

I don't think it's up to 'the government', it's up to the courts. It seems pretty clear to me that the school should have educated the students, and didn't. Hopefully the courts will see it that way as well.

Yes, I know that means the taxpayer footing the bill. The government was responsible for accrediting, regulating and auditing the colleges. The government, and collectively the people, are responsible for any failures in that duty and any individual citizens harmed as a result deserve compensation.

Note I'm not a US citizen, so my comments are meant in general.