Milking the system? $400,000 in student debt and not a single repayment.

[Eugene]

[quote=patb]He’s got between 3-400K in debt and it appears he’s been living with girlfriends, etc his whole life.

If he chooses to buy a house the median 2 BR apt in Manhattan is 1.27M
So Figure he’s looking at 1.7M in debt service.

That’s almost 100K/year in Debt Service.

Median First Year Associate salary was running 170K plus 30K bonus.

with pay down, figure it’s 170K now.

add 33% Income tax figure he’s looking at making 100K Net.

So i fhe wants an apartment, he’s looking at living on 10K.

Even if he rents a place it’s still going to be miserable.

[/quote]

but he does not have to buy a 2 BR in Manhattan. NYC is nice in that it has an awesome public transportation system that allows you to commute to Manhattan from anywhere in the five boroughs and from some parts of NJ under 45 minutes. Raise the limit to 1 hour one way, and he can commute from inner Connecticut (Greenwich, Stamford). An hour commute on a high speed train from Stamford to Manhattan is far more pleasant than an hour commute from Temecula to Sorrento Mesa.

A 2-br aparment in a remote (but still good) part of NYC could cost him 500k or even less.

Now, of course, there’s a certain amount of unavoidable miserableness (miserability? what’s the right word?) associated with living in NYC when you’re 47.

[Coronita]

[quote=ucodegen]

Don’t borrow money then. 🙂
Don’t like a CC card, cut up the card and say no thank you.

First, it is not a credit card debt… read the article. It is $400k in student loans & fees/penalties against the student loans. The actual amount that was student loan debt was $230k. The jump went from $270k to $435k in 4 years.. without any additional loans.. just fees. This is where the problem is. It also violates the law because the amount that is fees is in excess of statutory limit of 36%.

It is fine to be able to enter into an agreement with all eyes open.. but the student loan lenders abuse the system and the students taking out the loans. They violate the terms of the law and of the loan. Students have a hard time defending against this type of practice, they are forced to make a decision to pursue legal action or complete their degree.

[/quote]

I wasn’t suggesting it was a CC card. I was comparing this to folks that take out on a CC without reading the T&C. Anyway, why was he sent to a collection agency to begin with? That’s my question. I have to wonder what the other side of that story is.

[Coronita]

[quote=ucodegen]

Don’t borrow money then. 🙂
Don’t like a CC card, cut up the card and say no thank you.

First, it is not a credit card debt… read the article. It is $400k in student loans & fees/penalties against the student loans. The actual amount that was student loan debt was $230k. The jump went from $270k to $435k in 4 years.. without any additional loans.. just fees. This is where the problem is. It also violates the law because the amount that is fees is in excess of statutory limit of 36%.

It is fine to be able to enter into an agreement with all eyes open.. but the student loan lenders abuse the system and the students taking out the loans. They violate the terms of the law and of the loan. Students have a hard time defending against this type of practice, they are forced to make a decision to pursue legal action or complete their degree.

[/quote]

I wasn’t suggesting it was a CC card. I was comparing this to folks that take out on a CC without reading the T&C. Anyway, why was he sent to a collection agency to begin with? That’s my question. I have to wonder what the other side of that story is.

[Coronita]

[quote=ucodegen]

Don’t borrow money then. 🙂
Don’t like a CC card, cut up the card and say no thank you.

First, it is not a credit card debt… read the article. It is $400k in student loans & fees/penalties against the student loans. The actual amount that was student loan debt was $230k. The jump went from $270k to $435k in 4 years.. without any additional loans.. just fees. This is where the problem is. It also violates the law because the amount that is fees is in excess of statutory limit of 36%.

It is fine to be able to enter into an agreement with all eyes open.. but the student loan lenders abuse the system and the students taking out the loans. They violate the terms of the law and of the loan. Students have a hard time defending against this type of practice, they are forced to make a decision to pursue legal action or complete their degree.

[/quote]

I wasn’t suggesting it was a CC card. I was comparing this to folks that take out on a CC without reading the T&C. Anyway, why was he sent to a collection agency to begin with? That’s my question. I have to wonder what the other side of that story is.

[Coronita]

[quote=ucodegen]

Don’t borrow money then. 🙂
Don’t like a CC card, cut up the card and say no thank you.

First, it is not a credit card debt… read the article. It is $400k in student loans & fees/penalties against the student loans. The actual amount that was student loan debt was $230k. The jump went from $270k to $435k in 4 years.. without any additional loans.. just fees. This is where the problem is. It also violates the law because the amount that is fees is in excess of statutory limit of 36%.

It is fine to be able to enter into an agreement with all eyes open.. but the student loan lenders abuse the system and the students taking out the loans. They violate the terms of the law and of the loan. Students have a hard time defending against this type of practice, they are forced to make a decision to pursue legal action or complete their degree.

[/quote]

I wasn’t suggesting it was a CC card. I was comparing this to folks that take out on a CC without reading the T&C. Anyway, why was he sent to a collection agency to begin with? That’s my question. I have to wonder what the other side of that story is.

[Coronita]

[quote=ucodegen]

Don’t borrow money then. 🙂
Don’t like a CC card, cut up the card and say no thank you.

First, it is not a credit card debt… read the article. It is $400k in student loans & fees/penalties against the student loans. The actual amount that was student loan debt was $230k. The jump went from $270k to $435k in 4 years.. without any additional loans.. just fees. This is where the problem is. It also violates the law because the amount that is fees is in excess of statutory limit of 36%.

It is fine to be able to enter into an agreement with all eyes open.. but the student loan lenders abuse the system and the students taking out the loans. They violate the terms of the law and of the loan. Students have a hard time defending against this type of practice, they are forced to make a decision to pursue legal action or complete their degree.

[/quote]

I wasn’t suggesting it was a CC card. I was comparing this to folks that take out on a CC without reading the T&C. Anyway, why was he sent to a collection agency to begin with? That’s my question. I have to wonder what the other side of that story is.

[Author]

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