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Student Debt Lawsuits Are a Lucrative Business

nytimes.com

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Re: Student Debt Lawsuits Are a Lucrative Business

#91

Post by tomjen3 »

rayiner wrote: post #15
arcanus wrote: post #3

It is remarkable that you cannot declare bankruptcy from student debt. We have essentially decoupled the price of college from the expected return.

It's hardly remarkable. Student loans are originated without regard to credit risk, at the same interest rate for all borrowers. Moreover, pretty much every student is eligible to declare bankruptcy soon (and often, long) after they graduate. Requiring loans to be freely originated on one hand, and permitting people to discharge them in bankruptcy on the other, would be completely unworkable. As to why we require loa…

>As to why we require loans to be originated without regard to credit risk: if we took credit risk into account, disadvantaged groups would get student loans at drastically decreased rates.

Those are unlikely to be drastically decreased. What will drastically decrease is the amount of people, of any color, who can afford an art history degree. That is a good thing, especially for those who will be the first in their family who are going to college, and are therefore more likely to be swindled into one of those degrees in the first place.

Re: Student Debt Lawsuits Are a Lucrative Business

#92

Post by amorphid »

tudelo wrote: post #72
amorphid wrote: post #28

Earlier quoted context omitted.

As someone who exited a chapter 7 bankruptcy (all dischargeable debts wiped out) in 2010 with $140K USD in student loans, I can say with certainty that student loan debt sucks.

Oh wow. That must be some story about how you racked those up. I wish you luck.

Imagine a person who is the paragon on personal finance, wise & disciplined in all aspects of borrowing & spending; I was the opposite in my college days & grad school days :)

It's better now. Yay!

Re: Student Debt Lawsuits Are a Lucrative Business

#94

Post by bluGill »

mattnewton wrote: post #39
Posibyte wrote: post #35

Earlier quoted context omitted.

The bank should be entirely at fault here. If they looked at a student's request for a loan that said I'm taking a basket-weaving class at Cornell and I need $120k to attend then it's the bank's prerogative to look into the student's past performance, the rate of return for basket weavers, and the bias to which Cornell would prompt higher or lower returns in this area. Just like any area of lending, it's on the bank…

That’s a great way to cut people from disadvantaged backgrounds out of college degrees, and therefore social mobility.

Which disadvantaged?

The smart person who is born poor or a minority will do just fine as their grades will carry them. Thus a bank should give them a loan - based on their high school report card.

The "stupid" person regardless of background is unlikely to do well and should not get a loan.

Re: Student Debt Lawsuits Are a Lucrative Business

#95

Post by WorldMaker »

logfromblammo wrote: post #61
Verdex_3 wrote: post #56

Earlier quoted context omitted.

I don't think judges should necessarily be punished for bad decisions. The judiciary is a mechanism for allowing society to get along peacefully with one another (ie you can take your grievance to a judge instead of to the mob). I don't really want judges having to worry about punishment when doing their job. On the other hand. Incompetent and corrupt judges have no place in the judiciary because it's basically an at…

You forgot lazy. What do you do with the judges that simply can't be arsed to read the filings or briefs, and arbitrarily rule against those that seem to be making the most work for them? They want a light calendar, so they can spend more time doing literally anything else. So what do you do with those who will only do their job half-assed?

Vote them out in the next election?

Re: Student Debt Lawsuits Are a Lucrative Business

#96

Post by bluGill »

ChrisBland wrote: post #5
arcanus wrote: post #3

It is remarkable that you cannot declare bankruptcy from student debt. We have essentially decoupled the price of college from the expected return.

If we didn't prevent it, then you'd be stupid to not go to college take out $120k in loans and then declare bankruptcy at 22 prior to taking a job (you'd have no income and no assets). You'd be 29 by the time the bankruptcy fell off your credit report, meaning credit might be tight in those years to buy a car or house, but you'd be debt free - something many people in their 20s and 30s would gladly do if they were gi…

I do think students should be able to discharge student loans in bankruptcy. However to balance it out, you lose all rights to use any schooling. Try to register for any class again and your loans are reinstated with back interest. HR departments will be required to check the blacklist to ensure that your schooling is not relevant to any position you apply or might be promoted to. (you cannot raise to something like master plumber because a master plumber is expected to have some skills that you might learn in college even though most learn on the job)

Of course the HR blacklist needs to be protected by HIPPA like laws against misuse. A company should expect to sometimes hire someone and then find out they cannot promote them very far.

Re: Student Debt Lawsuits Are a Lucrative Business

#97

Post by EADGBE »

bluGill wrote: post #96
ChrisBland wrote: post #5

Earlier quoted context omitted.

If we didn't prevent it, then you'd be stupid to not go to college take out $120k in loans and then declare bankruptcy at 22 prior to taking a job (you'd have no income and no assets). You'd be 29 by the time the bankruptcy fell off your credit report, meaning credit might be tight in those years to buy a car or house, but you'd be debt free - something many people in their 20s and 30s would gladly do if they were gi…

I do think students should be able to discharge student loans in bankruptcy. However to balance it out, you lose all rights to use any schooling. Try to register for any class again and your loans are reinstated with back interest. HR departments will be required to check the blacklist to ensure that your schooling is not relevant to any position you apply or might be promoted to. (you cannot raise to something like…

HR Blacklist? Terrible idea.

Just because you made a mistake 20 years ago doesn't mean you should never be allowed again. We're not talking about murder; and this is directly messing with someone's livelihood.

Re: Student Debt Lawsuits Are a Lucrative Business

#98

Post by logfromblammo »

WorldMaker wrote: post #95
logfromblammo wrote: post #61

Earlier quoted context omitted.

You forgot lazy. What do you do with the judges that simply can't be arsed to read the filings or briefs, and arbitrarily rule against those that seem to be making the most work for them? They want a light calendar, so they can spend more time doing literally anything else. So what do you do with those who will only do their job half-assed?

Vote them out in the next election?

I think I'd be willing to move to wherever place it is you may be thinking about where that actually works.

I always vote "do not retain" in every election that allows the public to vote for judges, on the off chance that someone else that knows something I don't may need the help in removing a bad judge, and none of those judges ever failed to remain on the bench.

But most places that I have lived don't even vote on judicial retention. The only reliable way to get rid of a judge is to get them appointed to a more prestigious circuit, which would be a pyrrhic victory.

Re: Student Debt Lawsuits Are a Lucrative Business

#99

Post by EADGBE »

tudelo wrote: post #71
kharms wrote: post #26

Earlier quoted context omitted.

>Student loans are originated without regard to credit risk, at the same interest rate for all borrowers. That's not entirely true. For undergraduate students, no more than $57,500 can be loaned from the government at a fixed 4.45% APR. This is what you're talking about. If you need more than $57k (which you would even at most state schools) you need to get a private loan. Private loans have variable APR based on you…

A fixed rate that changes, right? None of my loans ever had the same percentage as the year before. Small point though.

Federal are fixed, private are often variable.

Also, not sure about the 4.45%. My federal are more than that.

Re: Student Debt Lawsuits Are a Lucrative Business

#100

Post by [deleted] »

logfromblammo wrote: post #80
ChrisBland wrote: post #41

Earlier quoted context omitted.

You and I are the bank, these loans are federal, no private bank is giving these loans out, you and I are and we are footing the bill when the natural default occurs

Private banks are giving the loans out. When they do, they keep the interest, but shovel the default risk onto the treasury without paying them to do it. The Dep't of Education also gives out direct federal loans and grants, and sometimes those private banks service those loans, but federal financing is now not quite enough to pay for a whole degree, so private loans are filling the gap, at greater expense to the stu…

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