San Diego Housing Bubble News and Analysis

I am currently considering law school, so this is very salient for me right now. I wonder if the free flow of credit extended to higher education, and if the ability to repay is hindered, if the credit market will eventually shrink. I guess the silver lining would be that universities would be forced to reduce tuition to bring it in line with local incomes as well!

I think there are two issues you're talking about.

1. College loans availability. There are different kids of college loans, I think the ones you're speaking that is having issues are the ones that  aren't of the fed guarantee type.

2. Issue with CA state funding and cutback at state schools. This was to be expected if you look at the state's budget. I'd expect  less enrollment, increased tuitions and possibly reduction of non-essential  labor at the universities  in the future.

selfportrait

----- Sour grapes for everyone!

Flu-

I'm talking about HSBC and M & T banks both pulling out of the federal student loan program.

I am really interested in predictions from piggies about this nationally, not just pertaining to CA.

i brought the question up two times recently at dinner parties and everyone looked at me like I had two heads. It felt eerily familiar... like when I used to bring up the idea that housing would implode.

Piggies are the smartest group I know... Give your thoughts!

"That really surprised me since SDSU was the place ANYONE could get into not too long ago"

When I graduated HS in 1976 (San Pasqual) SDSU was a place you would go if you could not get into other colleges. My daughter recently got accepted at SDSU, except she wants to be a nurse, getting into the nursing program a SDSU looks to be impossible so we are sending her out of state. There is no benefit by California for middle-income parents with college bound kids.

Demand for college educated people has gone up, so expect to see more and more kids trying to go to college. It use to be that secetaries, sales people, cops and firemen didnt need college educations, that isnt true anymore. But dont read TOO much into those numbers of applicants. The way kids are hedging their bets is to increase applications. When I applied to schools at the end of the last millinium, I applied to 8 and that was considered roughly normal if not alittle high. Now, 12-15 maybe even 20 applications are sent out commonly, just in case. SDSU is pickup up on this bounce.
UCSB had just such a pick up in the late 1990's. The new admissions director boasted about how they were gonna make it the next UCLA. Decided to only accept kids with GPA's above 4.0 and high SAT's (back when that was unusual). They only got ~65% of the kids they thought they would, and were forced to go around to the local high schools and tell kids to challenge the rejection or reapply, as they had a "good chance" to get in. I met the counciler, I know it happened.

As for college costs keeping kids out I dont think that will happen. Loans are still guarenteed by the Gov and 17 year old kids dont really think about 40-100k loans to repay. Besides, everyone knows that kids who graduated from college make like 90k a year starting and have all associated costs of life paid for them by a gratful employeer who will make them VP in 3 years. Especially with that nice communications degree mixed with a minor in underwater basket weaving.

DWCAP-

I see your logic on the application numbers - and I agree it is the cause (applying to so many vs. one or two in the past)...

However, I disagree about the federal loans being the thing that keeps the college attendance numbers up.

In general, tuition is much higher than the federal loans would cover for middle-class kids.

Its been my experience that downturns in general lead to increased competition for enrollment. When people lose their jobs, they try to get education to get a new job. It used to be say 20 years or so ago, that the majority of college acceptances were from high school. Sometime in the 90's (early I think) it switched to being more JC transfer students and re-curving professionals. For example in my computer science program we were almost equally divided between kids like me going through the system for the fist time, vs adults who were already in the work world and re-curving to make a better living.

Josh

2. Issue with CA state funding and cutback at state schools. This was to be expected if you look at the state's budget. I'd expect less enrollment, increased tuitions and possibly reduction of non-essential labor at the universities in the future.

Yeah pretty much. Students are a cost for the UC, so when there are budget cuts they can be made up by limiting enrollment and raising fees.

Mind you, the cuts are much less worse than the news reports have made them out to be. There was some judicious PR involved.

UCSD remains one of the top science schools in the country, so there will be no shortage of applicants for the foreseeable future.

Admissions

Graduate admissions are largely centralized through the Office of Graduate Studies. However, the Rady School of Management, Scripps Institute of Oceanography, and the Graduate School of International Relations and Pacific Studies (IR/PS) handle their own admissions.

Oh, great. Our kid was accepted two years ago at SDSU, too, but the nursing program is "impacted" and there's a three-year waiting list. Goes to a private college in CA, big merit scholarship but we are tapped out after paying for the first two years. The kid will be a junior in the fall. Withougt student loans...sunk. Any advice appreciated.

Oh, great. Our kid was accepted two years ago at SDSU, too, but the nursing program is "impacted" and there's a three-year waiting list. Goes to a private college in CA, big merit scholarship but we are tapped out after paying for the first two years. The kid will be a junior in the fall. Withougt student loans...sunk. Any advice appreciated.

It's not clear - are you saying your kid is going to finish up at SDSU? If so, have your kid get a job on campus. After the probation period, campus employees are eligible for free tuition.

That's the way one of our kids is going through school in the Cal State system. He takes pride in not relying on mom and pop. That makes me proud.

Thanks, Svelte. No, she is not finishing up at SDSU. See, the three-year SDSU nursing school wait would only start ticking for her this fall. She has to stay put. We paid for the first two years of the private college (with help from her working in the summers) but from now on, she's on her own. At least she's pretty assured of getting a job as a nurse as soon as she graduates, so the student loans (if she can get them) won't be so ominous. She plans to work as a nurse to put herself through grad school (wants to be a nurse practitioner).

Great advice about getting a job at SDSU. I did that myself when I went there, but they didn't have the tuition deal back in my day (I'm ancient).

CMcG - There are loan repayment programs available to nursing students who commit to working in a state institution (like a veterans home) for a period of time after school, or for nursing students who commit to teaching instead of practicing for some period of time, since part of the reason why educational capacity for nursing students is so dismal is a lack of nursing instructors. These options might not work for your daughter if she plans to go straight to grad school, but they are a way to stay out of debt. The teaching program is called SNAPLE and is administered through the California Student Aid Commission.

jennyo--Thank you so much. I had never heard about that and will look into it right away.

CMcG

Doesn't make a lot of sense why a parent would pay for 2 years of school without being committed to the full boat. Sort of like helping a kid swim half way across the pond. If they can't make it all the way across you are only helping them to drown.

That being said you can help your student in a couple of ways. With loan options the federal government provides parents with the PLUS loan currently fixed at 8.5% or 7.9 at Direct lending schools. On trick with this loan is that if you apply for it but use a wrong social security you will come up declined for the loan. You can have that decline letter sent to the school and they will use that to qualify the student as an independent student. As an independent student the amount of stafford loans they are eligible for increases from 5500 as a Jr and Senior to 10500 each year. The current rate on stafford loans are 6.8% fixed and depending upon your financial status some of that might be in the form of a subsidized stafford loan (government pays the interst on the loan while the student is in school and up until 6 months after graduation)

2 other things to keep in mind about financial aid for school. First the student assests are counted far more heavily in the calculation than the parent so make sure that the student is not keeping any money in their names.

2 schools do not count you home in the asssets section. Therefore a suggestion to all parents is that if you are a current home owner with College bound student it is a good idea to open up a line of credit to give yourself access to the equity in the house. Follow that up by taking a chunk of savings and paying down the mortgage. This way you are house rich and savings poor.

Last but not least take home the minimum amount of paycheck that you can. By this I means max out 401k , Flexible spending account and dependant care accounts. The less income you have the more aid you are eligible for.

After college the student can look to move their loans to the Direct Loan Program and potentially have their loans forgiven in area like Teaching and nursing. Some websites to check out are

www.mapping-your-future.org/pauying/loan...

http://ifap.ed.gov/regcomps/doc4280_body...

http://bhpr.hrsa.gov/nursing/loanrepay.htm

Godd luck

Thanks, Ray. I will look into your links. Very helpful. We, however, warned her from the start that there was only enough 529 money for two years of a private university. I guess she's not to blame, because people are not all that smart at 18. We could have easily paid for her to go to a CSU for all four years, but they didn't offer the program she needed or the program she needed was impacted and there was a waiting list. We are not interested in getting into more debt or putting our house on the line because she will easily make more having a BSN even without a graduate degree coming out of college than either one of us makes. My husband worked his way through SDSU in the 1970s doing crappy jobs; my parents at least paid the princely sum of $105 for the tuition per semester during the same period.

Nurses in SD make 100K+ per year, don't sweat the loans, they will be paid off promptly.

P.S. Travellers make even more.

Unfortunately times have changed and the reality is that the cost of Education is such that there is no way that a student can pay for it on their own.

Paretns who talk about the fact that they worked their way through college are missing the fact that Reganomics stole from the future generationds and wealth has transferred from affordable education into now unaffordable homes. You can't gloat about home equity and simultaneously frown at the fact that the goivernment is expecting parents to foot the bill. Not that CMcG is asserting that. Just my own blanket statement.

With respect to nurses getting paid 100k in San Diego the poster is misguided. San Diego pays nurses very low when compared to cities like San Fran Los Angesles, etc. Nurses who have time in are making about $35 an hour. Don't know where you are coming up with your 100K. Would be a very rare situation.

I know a number of NICU nurses, all have told me they make over 100K when working full time, those with extra qualifications such as respiratory technicians make a good 20K more.

I'd agree that nurses making 100K is pretty rare. I was considering nursing as a career several years back and I researched salaries. The only nurses that start out making near that much are nurse anesthesiologists. A regular nurse would have to kill him/herself in overtime making that kind of money.

There is no way a respiratory tech earns 120K a year. They don't get paid as much as nurses.

blue_sky

People sometime exaggerate their income. If we were in NY I might buy it. San Diego, sorry show me the pay check. 35$ an hour after they have experience.

A good deal for nurses is that if they are lower income and canqualify for a Perkins loan this can be forgivable.

Smart nurses do well when they do their 5 years and move into administration positions. Can estend the longevity of their careers.

I'm just conveying what has been said to me during many, many hours in NICU. On the respiratory tech front I'm not referring to the people with only resp tech training, I'm referring a someone who was working on their Neonatal Nurse Practitioner (NNP) with a focus on neonatal respiratory. Agreed that you won't get this level of salary right out of college.

Here's salary info on this level of qualification, you'll see the 100K level is the 75th percentile in San Diego, throw in some overtime and you're cooking with gas:

http://swz.salary.com/salarywizard/layou...