any cons in suspended student loans debt?
![[Post New]](/jforum/templates/default/images/icon_minipost_new.gif){kind=icon}
Anonymous
Do the millions of Americans who did not go to college count as "regular people?" These individuals comprise the majority of Americans. I'm sure that they'll enjoy seeing college educated, high earning Americans reap nearly $2 trillion dollars in benefits due to student loan forgiveness. What about future generations? What about them? What do they get? |
Anonymous
https://www.forbes.com/sites/zackfriedman/2022/03/19/heres-who-wont-qualify-for-62-billion-of-student-loan-cancellation/?sh=139a2d09213a Its only for people enrolled in PSLF. |
Anonymous
You are implying that only people who can afford it outright and people who get scholarships are the only ones who should go to college. Yes, this country was built on labor/blue collar and then the jobs got shipped overseas.https://www.businessinsider.com/what-happened-to-american-jobs-in-the-80s-2017-7 It was no longer lucrative to have those jobs so people stopped suggesting that their kids entered trade jobs. Are you really this obtuse? Not to mention that 20 years ago when I was in HS and selected auto shop as my elective they told me no because I would be too distracting to the boys in the class and I was doing it only to get boys attention. My real reason for doing it was because I wanted to be able to fix my own car so I wouldnt have to pay anyone to do it. Women also traditionally werent accepted in blue collar occupations and only recently has that changed. Women were siloed into domestic occupations but not any that were lucrative. In the 80s women started moving into managerial and executive white-collar positions and that has been the way forward for many women. |
Anonymous
I didn't read pp's comment as if only those who can afford it "outright" can go. She said......"don't buy what you can't afford." IOW - if you are going to take out a loan, be prepared to pay it back and make sure you get a degree in something that will ensure an income to enable you to pay it back. Don't expect the government to bail you out. |
Anonymous
I would be fine with just paying the money that I actually took out. Interest begins to accumulate before you can even start your job. When you take out $50k total over 4 years and it's 75k 4 years AFTER you graduate and have made payments it is not a viable system. |
Anonymous
Did you not understand what interest was when you signed on the dotted line? |
Anonymous
|
I got through undergrad loan-free because my parents paid for it. I had law school loans, but they were minimized b/c I was able to live at home (my desired law school happened to be in my hometown). I have since paid those loans off - including by working longer that I personally wanted to in a large firm where the pay was great but not necessarily work i was passionate about.
I have no problem with the idea of debt forgiveness. The fact I paid off loans and someone else might not have to is fine with me. My big problem with these ''debt cancellation" initiatives pushed by certain factions of the left (I'm a democrat) is that they are extremely *regressive*. They amount to portions of debt holders who are easily able to pay off their debt over time being subsidized by everyone else. To get my full support, debt cancellation needs to be targeted at lower income people who are saddled with debt that they cannot possibly pay off because of their station in life. The fact that it's taking you longer to buy a condo or you need to work in the private sector when you want to work in the public sector so you can pay off debt aren't reasons for the rest of us to be subsidizing debt cancellation. |
Anonymous
Sorry, but that's how loans work. When you start paying, initially your payment is primarily interest. You have to pay either more than the minimum to pay towards principal early. This is part of why they tell people that if you buy a house with a mortgage, you should be prepared to stay at least 5-7 years minimum. If you try to bundle the closing costs into the loan, then you often spend the first 13-30 months paying any non-interest payment to pay down the closing costs that you bundled. After that, it will take 3-5 years more to pay down enough interest that you are actually starting to get around the interest and start contributing to the actual principal of the loan. If you want to change the numbers you have to pay extra towards the principal earlier, and it will decrease the amount that goes towards interest every month. People who don't understand how loans work, should not get the free ticket to good salaries and jobs and then be bailed out of bad decisions and the consequences of those bad decisions. Sorry, you don't like the terms of the legal financial agreement that you agreed to. You should have thought about that before you took out the loans When you graduated, you should have also started looking at the amortization schedule of your loan and figured out that you needed to pay more than the minimum amount due to avoid increasing interest rates. And you should have thought about that before you bought that new car or put down a downpayment on a home. You chose not to do your homework on what it would take to pay down the loan, as opposed to making the minimum payment due and so you get to keep paying. Note that the same thing will happen if you pay only the minimum due on your credit card balance. Are you saying that we should be forgiving credit card debt too because the balance due will continue to increase if you only make the minimum payment? |
Anonymous
This exactly. It’s not the original loans as much as the enormous compound interest that is causing such a huge crisis. It makes it very difficult for people who aren’t making large salaries or aren’t living a poverty-level life in order to make extra payments pay it off. The compound interest makes the balance keep growing and growing way beyond what they originally borrowed. |
Anonymous
A mortgage is not the same type of loan, so that’s not an apples to apples comparison. Yes, if you go with an adjustable rate mortgage your interest amount might change on your payment. But the mortgage itself doesn’t keep growing and growing, compounding and compounding. When people take out student loans they assume it’s like a mortgage payment and it’s not. Yes, that is somewhat on them for not understanding, but the student loan industry also has gone out of its way to make sure these students don’t understand the compound interest dynamic. Credit cards are very similar though and yes, I agree that we shouldn’t just bail out credit cards either. BUT, with credit cards if you get into bad financial trouble, you can declare bankruptcy. There are life penalties to that for 7 years so it’s not a decision to make lightly. But there are options with credit card debt if you’re in trouble. With student loans, there’s no bankruptcy discharge. So they don’t even have that choice. And the total balance just keeps compounding higher and higher. So yes, it is an untenable system. If it were restructured like a mortgage, that would be more tenable. |
Anonymous
Once again, you have Obama to thank for this. He decided to have the government take over the student loan process. Prior to this, interest rates were lower and more competitive. https://thehill.com/blogs/congress-blog/education/279512-president-obamas-horrible-terrible-legacy-on-student-loans Republicans were unanimously opposed to his actions. https://www.nytimes.com/2010/03/26/us/politics/26loans.html |
Anonymous
There were so many problems with the private sector handling student loans back then. Since the student loans were guaranteed by the federal government, the private servicers would drive lenders into default so the servicer could get the fed gov to buy back the loan plus interest, fees, and penalties. It was a multimillion dollar grift against the government. |
Anonymous
| It's a pandora's box. The Democrats would wisely let it drop. Most people are not going to look favorably on it either because it's a free gift they don't benefit from or they paid off their loans and don't get rewarded for it. And others will see what's the point of loan forgiveness when there's no attempt to reform higher education either. It'd just encourage people to take out more loans with the assumption it'd get paid off by the government in the future too. It could easily turn into an issue people severely punish the party at the next election. |
Anonymous
Wisely let it drop? I wonder if you polled voters just how far down the priority list you would find denying loan forgiveness. |
Anonymous
Forgiving loans is clearly not a voting issue for most voters, so why risk turning it into a voting issue? Loan forgiveness isn't going to win new voters to the Democrats, but it does seriously risk turning out the vote against Democratic largess. |