Student Loans

[Disneychick13]

I think that the whole idea of student loan forgiveness, for this one snapshot in time, really doesn’t make sense unless you want to feel good in the moment (or have some people feel good about you right now). We can talk about how college should be free or that reforms should be made (by most higher learning institutions, not just lenders!). That would be a worthy conversation to have. But not how people who signed a paper to borrow money now don’t have to pay it back. It encourages more bad behavior from both borrowers (hey, they did it once so they will do it again), colleges and universities (suckers!) and lenders (we will get paid no matter what, yipeee). If you look past empathy (but those poor people!) and actually take into account what debt forgiveness like this will really mean and encourage, I think maybe you (as in anyone)might form a different opinion. I feel bad for lots of people in lots of situations. If I’m being honest, people who take out student loans are way down on that list.

 

[TippyThomas]

This thread has been interesting to say the least.

 

[Sinder]

It is so disheartening to read so many judgmental responses. I am surprised that so many assumptions and labels are cast upon those with student debt. It saddens me that people can make generalizations about groups of people, as if they are true.

Opportunity is not equal. Hard work does not change that. It is not that simple. Just because someone's path is different than yours, doesn't mean that they don't deserve what you do.

Education, healthcare, and a clean environment are human rights that everyone deserves.

This thread is unproductive and is only going to get worse.

I would recommend that the moderator close it.

Your right to a free education ends at 12th grade, you are then free to choose to continue your education on your own dime.
The taxpayers gave you 13 years of education its time to adult up and pay for it yourself.
Sometimes that means you have to borrow money to do it, and that’s Ok. Just don’t expect others to pay your bill

 

[barkley]

$20k is not the kind of debt people are demanding loan forgiveness on. That's less than a car payment - drive a beat-up used car for a while until you get that paid off - problem solved.

there are many people with less than 20k remaining on their student loans who are not demanding but would be in a tremendously better financial circumstances if their loans were forgiven in whole or part. to say that it's just the same amount as a car payment presumes they can afford a car payment-many can't. the 'beater' you suggest they drive is what they've been driving for years (if they have a car at all-most of my oldest's college grad peers don't and rely on less expensive public transportation).

i have mixed feelings on both sides of the 'argument' over loan forgiveness. from a personal standpoint i can see it resulting in my own kid who opted for the lowest cost public university option, hustled for every scholarship, worked upwards of 3 part-time jobs per quarter, never lived in a dorm or had what most (i read on-line of) consider 'the college experience' (going out to party, spring break, summers off, study abroad...). as a result there was just about 20K in loans outstanding upon graduation and that's been whittled down over the last 4 years to less than 10K by working overtime and taking any holiday bonus, stimulus money and such to throw at it. lifting that last 10K would mean actually being able to contribute a few dollars a month to create an emergency fund let alone to the employer matched retirement plan. on the flip side i know it will raise our taxes and their's not for the short term-for the long haul which will impact on everyone's financial stability.

there are no easy answers or solutions-i just wish someone would get off the pot and make a decision-stop making empty promises and keeping people in limbo.

 

[BK2014]

They're unsecured loans issued to debtors with little to no repayment history

Then I got into Notre Dame and Boston College the next day and their need-based aid was incredibly generous.

I think this captures part of the problem. People keep saying that the students should have known what they were signing. And maybe that is true. But on the flip side, why are they able to borrow so much money when they would, in most instances, not qualify for any other types of loans? As noted, these are unsecured loans given to people with little repayment history, who also have no income and no way of knowing what their income will be when they graduate. Anyone who started college/grad school before the "great recession" knows that what the job landscape looks at when you start school can change dramatically.

And why is what a student qualifies for in loans or need based aid tied to their parents' income? The majority of college students should qualify for need based aid because they have no income or assets of their own. Instead, every year we had to fill out aid forms reporting our parents' income levels for these things to be determined. I think it is wrong to assume that just because the parents have money or assets that they are being shared with the student. *Caveat, I do not have kids of my own and went through this 15+ years ago, so I don't know if this has changed.

 

[barkley]

I think this captures part of the problem. People keep saying that the students should have known what they were signing. And maybe that is true. But on the flip side, why are they able to borrow so much money when they would, in most instances, not qualify for any other types of loans? As noted, these are unsecured loans given to people with little repayment history, who also have no income and no way of knowing what their income will be when they graduate. Anyone who started college/grad school before the "great recession" knows that what the job landscape looks at when you start school can change dramatically.

And why is what a student qualifies for in loans or need based aid tied to their parents' income? The majority of college students should qualify for need based aid because they have no income or assets of their own. Instead, every year we had to fill out aid forms reporting our parents' income levels for these things to be determined. *Caveat, I do not have kids of my own and went through this 15+ years ago, so I don't know if this has changed.

along the same lines-the 'cost of attendance' at most places which is the number they are telling kids they need to have is a bloated formula that includes on campus living which many kids have no need for or can get by on a greatly reduced amount by living off campus. i just looked at our local public university and the 'cost of attendance' breaks down to 30% for tuition and fees/ 70% for 'on campus room and board' they sell kids a bill of goods that they have to live on campus to experience the 'real college life' when it's just another cash grab that runs up student loan balances to astronomical amounts.

 

[Colleen27]

I think this captures part of the problem. People keep saying that the students should have known what they were signing. And maybe that is true. But on the flip side, why are they able to borrow so much money when they would, in most instances, not qualify for any other types of loans? As noted, these are unsecured loans given to people with little repayment history, who also have no income and no way of knowing what their income will be when they graduate. Anyone who started college/grad school before the "great recession" knows that what the job landscape looks at when you start school can change dramatically.

Because the meritocracy myth is deeply engrained in our culture and we're not comfortable with a blunt truth like "Some kids just can't afford to pursue higher education, no matter how bright they might be", so we want those loans to be available so we can continue to believe anyone can make it if they just work hard enough.

 

[Lumpy1106]

along the same lines-the 'cost of attendance' at most places which is the number they are telling kids they need to have is a bloated formula that includes on campus living which many kids have no need for or can get by on a greatly reduced amount by living off campus. i just looked at our local public university and the 'cost of attendance' breaks down to 30% for tuition and fees/ 70% for 'on campus room and board' they sell kids a bill of goods that they have to live on campus to experience the 'real college life' when it's just another cash grab that runs up student loan balances to astronomical amounts.

Kindof a side note but related; we are looking at a couple of different smaller Universities for DD right now that REQUIRE you to live on-campus for at least the first year. I think my Alma Matter does too. These are all very affordable schools though - not really part of the problem. No idea if this is the case with the more expensive Universities.

 

[disney-inspired]

My taxes pay for a lot of stuff I don’t agree with. I would be happy if it went towards some form of student loan relief (namely forgiven interest).

My thoughts exactly. There is already so much money put to things that don't benefit the general population that I would be happy for it to have some real world impact in a good way.

 

[Mackenzie Click-Mickelson]

along the same lines-the 'cost of attendance' at most places which is the number they are telling kids they need to have is a bloated formula that includes on campus living which many kids have no need for or can get by on a greatly reduced amount by living off campus. i just looked at our local public university and the 'cost of attendance' breaks down to 30% for tuition and fees/ 70% for 'on campus room and board' they sell kids a bill of goods that they have to live on campus to experience the 'real college life' when it's just another cash grab that runs up student loan balances to astronomical amounts.

I agree with you in a sense but also understand there's a logical practical thing to that. Where my alma mater is located at already balloons in residency when students come, the traffic and congestion becomes awful. The college does not require freshman to live on campus although I do believe many do.

But realistically it is not something that many cities/areas could absorb in terms of students if all lived off campus or even a majority. Switching back to where my alma mater is at there's not enough apartments (and affordable ones at that), there's no enough public transit buses in the city and the campus fees since 2007 I think pay for the buses on campus so whether you use them or not you'll be paying for them (which I'm glad because the campus buses used to cost $75 per semester) although you do pay extra for park and ride (meaning parking lots located off campus meant for students who live off campus). Parking lots are limited even meant for the dorms (and you still pay for a parking pass for those) and very limited on campus and very costly for what few parking spots there are. I worked on campus my senior year and beyond my graduation, I did get very good at parallel parking on a hill but there were times I had to park streets away.

You're not incorrect that yeah sometimes that college experience is hyped up beyond what it should but for many there's other reasons that are far and above some stereotype about campus living.

On a side note in all honesty I ate better and was in better shape when I lived on campus (comparing 2 years on campus 2 years off campus). The dining plan wasn't that bad but suddenly when I had to price things out individually pasta was my go to. And when I was off campus I was no longer walking every day which I did when I lived on campus...up a hill at least for my freshman year and then my sophomore year I was able to take a path that I didn't have to go up the hill but I got a lot of exercise just by walking. Off campus I was way too far away for that and my exercise was limited to walking from class to class. They have a name for it too..KU calves.

 

[dreamer17555]

Not only do many schools require you to live on campus at least the first year but there are also students who come from homes where staying at home and commuting would make education nearly impossible. Homes that don’t have stable Internet or even power, homes with food scarcity, homes that are violent or dangerous. Or they might not have access to a car to be able to commute because they have been contributing their funds to keep the family afloat from whatever job they have. Not every city is set up with great public transportation. Not every location that has a college within easy distance. We want these students to be successful as well. It’s complicated. There are no easy answers.

 

[dreamer17555]

Curious question what do you consider an affordable school (tuition and fees)? How much do you think is reasonable for room and board if required for the first year?

 

[mom2rtk]

Not only do many schools require you to live on campus at least the first year but there are also students who come from homes where staying at home and commuting would make education nearly impossible. Homes that don’t have stable Internet or even power, homes with food scarcity, homes that are violent or dangerous. Or they might not have access to a car to be able to commute because they have been contributing their funds to keep the family afloat from whatever job they have. Not every city is set up with great public transportation. Not every location that has a college within easy distance. We want these students to be successful as well. It’s complicated. There are no easy answers.

In homes with food scarcity and students contributing to pay the household bills, kids will typically qualify for lots of need based FA.

 

[dreamer17555]

In homes with food scarcity and students contributing to pay the household bills, kids will typically qualify for lots of need based FA.

A lot financial aid still assumes that a student‘s going to take out the max federal loans.

There are also cases where the parents are doing well but have disowned or kicked an adult child out. Refused to fill out the necessary paperwork and that can be tricky to get schools to approve financial aid without evidence of hardship. This was the case for one of my DD’s friends.

 

[mom2rtk]

A lot financial aid still assumes that a student‘s going to take out the max federal loans.

There are also cases where the parents are doing well but have disowned or kicked an adult child out. Refused to fill out the necessary paperwork and that can be tricky to get schools to approve financial aid without evidence of hardship. This was the case for one of my DD’s friends.

I wish I knew the answer to that. If you base things on what parents are willing to actually contribute (versus what a formula says they can contribute) then nobody is going to want to contribute. Need would skyrocket and awards would go down since there wouldn't be enough to go around.

 

[kymom99]

Kindof a side note but related; we are looking at a couple of different smaller Universities for DD right now that REQUIRE you to live on-campus for at least the first year. I think my Alma Matter does too. These are all very affordable schools though - not really part of the problem. No idea if this is the case with the more expensive Universities.

They still inflate those costs by listing the most expensive meal plan and room.

 

[Mackenzie Click-Mickelson]

I wish I knew the answer to that. If you base things on what parents are willing to actually contribute (versus what a formula says they can contribute) then nobody is going to want to contribute. Need would skyrocket and awards would go down since there wouldn't be enough to go around.

FAFSA in its current form is 30 years old. I do believe life has changed in the last 3 decades. And old formulas pre-date that but hey women got the ability to qualify in 1972...so I guess that's progress somewhere but a bit mind boggling that 16 years before I was born women were considered in the grand scheme of things for higher education

Largely our way of financial aid for colleges is rooted in archaic ways of thinking. When I was looking around I found an article from WP from last year. The headline is "75 years of reforms have failed to fix our college financial aid system" but yes let's continue to do what isn't working in the grand scheme and then loudly complaining about our student loan debt issue at a national level all the while having a society built upon higher education for job qualifications all the while not paying anywhere near what someone could make a life-long career out of without said higher education.

​

 

[mom2rtk]

They still inflate those costs by listing the most expensive meal plan and room.

I believe they are setting up a "worst case scenario" for the funding. Nobody makes you choose the most expensive room or meal plan. It just creates a figure they work from to make funding available. Unfortunately, some students take out the max available then use that money for things that aren't bare bones necessary.

My 2 kids that went away were both required to live on campus first year, then were able to move off campus and economize on living arrangements. My son went with a 1 room efficiency apartment. Kitchen was a mini-fridge and a microwave. He was the classic Ramen noodle college student. And he kept his loans to a reasonable amount.

My daughter went with more of a traditional apartment, but nothing fancy at all. And she eats for far less than any meal plan they sell on campus. Works at Starbucks and gets lots of her food for free. She has also kept her loans to a reasonable amount, not even the full federal loan amount.

 

[mom2rtk]

FAFSA in its current form is 30 years old. I do believe life has changed in the last 3 decades. And old formulas pre-date that but hey women got the ability to qualify in 1972...so I guess that's progress somewhere but a bit mind boggling that 16 years before I was born women were considered in the grand scheme of things for higher education

Largely our way of financial aid for colleges is rooted in archaic ways of thinking. When I was looking around I found an article from WP from last year. The headline is "75 years of reforms have failed to fix our college financial aid system" but yes let's continue to do what isn't working in the grand scheme and then loudly complaining about our student loan debt issue at a national level all the while having a society built upon higher education for job qualifications all the while not paying anywhere near what someone could make a life-long career out of without said higher education.

​

Can you be more specific about how you think it should be different?

 

[kymom99]

I believe they are setting up a "worst case scenario" for the funding. Nobody makes you choose the most expensive room or meal plan. It just creates a figure they work from to make funding available. Unfortunately, some students take out the max available then use that money for things that aren't bare bones necessary.

My 2 kids that went away were both required to live on campus first year, then were able to move off campus and economize on living arrangements. My son went with a 1 room efficiency apartment. Kitchen was a mini-fridge and a microwave. He was the classic Ramen noodle college student. And he kept his loans to a reasonable amount.

My daughter went with more of a traditional apartment, but nothing fancy at all. And she eats for far less than any meal plan they sell on campus. Works at Starbucks and gets lots of her food for free. She has also kept her loans to a reasonable amount, not even the full federal loan amount.

I think I may have heard that the schools quote the highest costs in order for them to get more funding for their school. I don’t know if they get more aid or what. Don’t know if I have that right but I think I do. Something to that effect.

And I agree, there are ways to economize. My son actually lived in a dorm all 4 years. He didn’t get to know anyone well enough to feel like he wanted to enter into a lease for an apartment. Also he liked not having to drive to class. He parked his car in the lot and didn’t have to get back in it unless he wanted to go out somewhere. We looked at apartments that would be doable but when we figured in internet, laundry, etc. there was no savings. Oddly enough, I bought him a meal plan every semester. I didn’t buy the most expensive one, but wanted to be sure he had access to a full meal each day. He ate well and never gained weight. It was money well spent. His books were cheap because of his major, which was nice.