Reply to When will the college tuition bubble burst?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]The high cost of tuition is driven by the availability of federal loans to fund it.  The Department of Education could put a brake on the rising costs by imposing rules on schools for eligibility, including limiting the price tag, for tuition or for other expenses.  [/quote]

+1.   Stop making it so easy to get a loan for college, and the cost will go down.

[/quote]

[b]This[/b]. Like many messes, the federal government is to blame.[/quote]

If you want lenders to stop giving education loans in a carefree manner, make those loans dischargeable in bankruptcy. Students loans are not dischargeable, so there is zero incentive for lenders to actually consider ability to repay. That debt will follow you to the grave.

Make the lenders have some skin in the game and they’ll be more circumspect with their loans, which means colleges will have to react by bringing down prices.

My bankruptcy professor in law school walked us through it. [/quote]

This is by far one of the best and immediate ways to address the cost insanity.

The govt had the best intentions in the 80s when they set up the govt loans for education program...everyone should have the chance at higher education in the US.  Opportunity is one of the big things our country stands for.  But unfortunately the US is also a market economy and the loan program set the stage for massive increases in tuition as more applicants entered the fray and colleges took advantage of the market demand.  It’s created a mess.  There’s not much alternative to paying the going rate of attending college other than not going, and most folks are not wanting to make that choice.  Too many US jobs and career paths require  a bachelors degree whether you really need one or not.

But, if lenders put pressure on the schools by refusing to loan out ridiculous sums of money to 20 year olds, that might pressure tuition rates to at least stand still if not deflate. [/quote]

then we return to where we were before; kids who have parents who can pay will be unaffected, kids who have parents with good jobs who need loans will pay higher rates but still get an education, kids who need loans with poor parents or parents with terrible credit will be SOL[/quote]

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