Home › Forums › Financial Markets/Economics › fear of student loans. ex.37665(a)
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The-Shoveler.
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January 29, 2013 at 1:52 PM #758672January 29, 2013 at 1:52 PM #758673
no_such_reality
ParticipantJanuary 29, 2013 at 5:52 PM #758683CA renter
Participant[quote=no_such_reality]LA Times: Nearly half of college grads have jobs that don’t require diplomas[/quote]
Thanks for sharing this article, NSR. It’s something all of us parents need to really think about WRT allowing our kids to take on massive amounts of debt for a degree that may, or may not, pay enough to extinguish that debt while still affording a fairly middle-class lifestyle.
Even in engineering and other sciences, with China and India pushing through hundreds of thousands of engineering graduates per year (numbers aren’t exact, see linked article), the pay rate of engineers in the U.S. is under certain threat, IMHO.
February 1, 2013 at 8:45 AM #758748patb
Participantwe may still be better off letting them discharge this debt.
we let corporations discharge debt in Chapter 11 and businesses are utterly ruthless, why do we put the dog on people who marry, have kids, etc..
If there is fraud, go after them, but, the system is awash in debt, that has to end.
February 1, 2013 at 9:30 AM #758751meadandale
Participant[quote=patb]we may still be better off letting them discharge this debt.
we let corporations discharge debt in Chapter 11 and businesses are utterly ruthless, why do we put the dog on people who marry, have kids, etc..
If there is fraud, go after them, but, the system is awash in debt, that has to end.[/quote]
Businesses rarely get capital (loans) unless they have assets, have pitched a concept to a VC for funding or have some kind of track record of success.
Try walking into a bank as a new corporation and trying to borrow an hundred grand. Ain’t gonna happen without them wanting a lot more information. If they aren’t happy with the answers forget it.
I’m all for applying the same requirements to students: you want to borrow a hundred grand for school? What are you going to study? What is the job market like for people with your degree? How do you plan on paying back the money? If the bank likes the answers and agrees with the risk and then the student defaults down the road because things didn’t quite work out like everyone thought then it would be more aligned with your theory.
February 1, 2013 at 11:13 AM #758754bearishgurl
Participant[quote=patb]we may still be better off letting them discharge this debt.
we let corporations discharge debt in Chapter 11 and businesses are utterly ruthless, why do we put the dog on people who marry, have kids, etc..
If there is fraud, go after them, but, the system is awash in debt, that has to end.[/quote]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.
At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.
February 1, 2013 at 11:36 AM #758758livinincali
Participant[quote=bearishgurl]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.[/quote]
These people will get bailed out at some point. Most likely the taxpayer as politicians look to buy irresponsible people votes. We did it with housing we’ll do it with college loans. It never ends.
February 1, 2013 at 11:44 AM #758760Participant[quote=livinincali][quote=bearishgurl]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.[/quote]
These people will get bailed out at some point. Most likely the taxpayer as politicians look to buy irresponsible people votes. We did it with housing we’ll do it with college loans. It never ends.[/quote]
With housing, lenders who were bailed out at least ended up with something they could “sell,” (either thru SS, foreclosure or deed in lieu – in whatever condition it was in). And secured creditors such as RE lenders have the right to a release of the automatic stay a debtor acquires in BK.
Sallie Mae and private lenders who have to write off a student loan discharged in BK will have NOTHING.
There are NO TRUST DEEDS (or “mortgages,” in other states) filed on student loans because there is NO COLLATERAL given.
Different animals.
February 1, 2013 at 11:48 AM #758761ParticipantSome of you may already be aware that a personal injury award or student loan of ONE party is NOT divisible in a dissolution of marriage.
They belong solely to the party who sustained the injury or “benefited” from the education. In community property states (such as CA), neither are part of the “community” and thus neither are divisible property/debt.
As it should be.
February 2, 2013 at 9:13 AM #758792earlyretirement
Participant[quote=bearishgurl][quote=patb]we may still be better off letting them discharge this debt.
we let corporations discharge debt in Chapter 11 and businesses are utterly ruthless, why do we put the dog on people who marry, have kids, etc..
If there is fraud, go after them, but, the system is awash in debt, that has to end.[/quote]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.
At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.[/quote]
I totally agree with you BG. I don’t believe it should be easy to discharge student loan debt so easily. While I do think there are legitimate cases where someone might have a need to write off the debt, I don’t believe that it should be easy for anyone in bankruptcy.
I speak from experience having graduated with over $100k in student loans and paid them all back. As much as some people want to say a college degree is worthless these days. The truth is they are not. As mentioned, they are almost a necessity in getting a solid job after college.
Us taxpayers would be on the hook most likely if people were able to discharge them so easily.
As mentioned, I think banks need to change the way they dole out these loans and look at each individual situation of the student, their grades, their majors, etc. Obviously higher risk degrees (i.e. almost worthless degrees) would need to have parent co-signers that agree to pay it back if the student doesn’t. That would make parents think twice about Johnny or Janie getting that Art History or Religion major.
But I wouldn’t like to see everyone just able to discharge their student loan debt so easily as we’d get hit somehow. Banks would pass this on to us.
February 2, 2013 at 12:03 PM #758794NotCranky
ParticipantHey, did scaredy eat his dog food and move on from Piggington’s?
February 3, 2013 at 1:46 AM #758811Participant[quote=earlyretirement][quote=bearishgurl][quote=patb]we may still be better off letting them discharge this debt.
we let corporations discharge debt in Chapter 11 and businesses are utterly ruthless, why do we put the dog on people who marry, have kids, etc..
If there is fraud, go after them, but, the system is awash in debt, that has to end.[/quote]
I am completely against this. I know several people (early gen-x-ers and boomers) who have deliberately taken out $65K to $120K in student loans AFTER the age of 45. I have NO IDEA who any of them think would hire them in this day and age after they obtained their lofty credentials. In all cases, this was an utterly foolish idea, IMHO.
At any age, it is grossly unfair to those who kept their noses clean and only paid for the education their could afford in life. IOW, their “contemporaries” (who elected NOT to borrow for college) shouldn’t be “outgunned” in the job market by those who successfully “stole” a bachelor’s degree or even graduate degree!
A college “degree” is not something which can be repossessed. There is no collateral here. The benefits of a degree follow the former student until their deaths. Just like a personal injury award (a condition that follows the individual who sustained the injury until their death), the injury award/college debt legally belongs SOLELY to the affected person.[/quote]
I totally agree with you BG. I don’t believe it should be easy to discharge student loan debt so easily. While I do think there are legitimate cases where someone might have a need to write off the debt, I don’t believe that it should be easy for anyone in bankruptcy.
I speak from experience having graduated with over $100k in student loans and paid them all back. As much as some people want to say a college degree is worthless these days. The truth is they are not. As mentioned, they are almost a necessity in getting a solid job after college.
Us taxpayers would be on the hook most likely if people were able to discharge them so easily.
As mentioned, I think banks need to change the way they dole out these loans and look at each individual situation of the student, their grades, their majors, etc. Obviously higher risk degrees (i.e. almost worthless degrees) would need to have parent co-signers that agree to pay it back if the student doesn’t. That would make parents think twice about Johnny or Janie getting that Art History or Religion major.
But I wouldn’t like to see everyone just able to discharge their student loan debt so easily as we’d get hit somehow. Banks would pass this on to us.[/quote]
Or, we could get the government out of the student loan business altogether (no guarantees, nothing), and let the private market deal with it. I’m willing to bet that loans would be much smaller and much more expensive, likely leading to lower tuition and other costs. As many have already pointed out, the reason college educations have gotten so expensive is because everyone has been conditioned to take on six-figure loans to go to college. That’s totally unnecessary for most college students (yes, they might have to live at home for a few more years, start out at a junior college, and work their way through school, etc.). Unless one is getting a medical degree (even law degrees are questionable at this time), or a doctorate in a very high-demand, lucrative field that is likely to be in high-demand for a long time, getting into that much debt for a degree is foolish, IMHO.
The reason student loans are non-dischargeable in BK is because most of them are backed by the government. The government should return to the funding levels for higher education that were in place ~20 years ago, rather than backing private-market or public student loans that are more likely to push prices up and force more people deeper and deeper into debt.
February 3, 2013 at 3:06 PM #758816cvmom
Participant[quote=Blogstar]Hey, did scaredy eat his dog food and move on from Piggington’s?[/quote]
I think he was absolutely serious about that, unfortunately.
February 4, 2013 at 12:41 AM #758819Participant[quote=cvmom][quote=Blogstar]Hey, did scaredy eat his dog food and move on from Piggington’s?[/quote]
I think he was absolutely serious about that, unfortunately.[/quote]
True, and I hope he changes his mind.
May 8, 2013 at 9:02 AM #761847ParticipantI thought this was interesting and good to see.
Private universities and colleges being forced to effectively lower their tuition via grants and scholarships.
More parents need to really think about the logic of sending their kids to expensive (in many cases inferior) private schools that cost a fortune.
I’d love to see these schools being forced to cut costs drastically or go under.
http://online.wsj.com/article/SB10001424127887324582004578461450531723268.html?mod=trending_now_1
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