Job Discussion Forums

[The Ever-changing Cleric]

[chinatwin88]

It all comes down to your word, and how good it is. To discover the answer, all one has to do is ask themselves, "did I request a loan and promise to pay it back?".

[JZer]

[JZer]

[The Ever-changing Cleric]

[JZer]

[chinatwin88]

[Santos L Halper]

JZer, you raise some interesting questions. Unfortunately, I think that it's beyond us to make the necessary changes.

I think that you already alluded to one big thing people could do to reduce reliance on usurious means of funding college: stay closer to home. Based on my experience, people who went to SW State College perform on the job every bit as well as those who went to Flagship U.

Higher education is a racket no different from any other entity: it's about the money. As long as people are willing to pay the prices to attend, and the govt enables this via easy loans, then prices will continue to increase.

It's interesting, as has been mentioned, that many of the people who were walking away from large loans are the high earners who simply don't want to pay. I believe the recent bankruptcy law changes exclude student loans as able to be discharged in bankruptcy.

As to whether an 18 year old is capable of making such decisions, it's been mentioned in this discussion that it's the law regardless of what anyone's personal opinion is. That's the bottom line. However, an 18 year old should have some support network to advise when something is probably not the best move. Usually this would be the parents, but not everyone has that luxury. I think that the problem comes in that we continue to coddle people, in many different ways. Sheesh, the tax code counts as dependents people up to 24 years old. How far should we extend adolescence? I believe that if you put people in the fire, they will respond. That's to say, treat people as adults and expect them to behave as such.

[jm21]

Up until fairly recently an 18 year old wasn't responsible for a contract in the US. It's a shame that isn't the case anymore. The old age of majority, 21, seems far more reasonable.

I thought that student loans were never normally allowed to be resolved through a bankruptcy proceeding. That's why the government is able to offer them. Didn't they always have to show an extreme hardship or something like that?

I think one factor here that seems missing is the fact that the government is offering these huge unsecured loans to people that are extremely hard to get rid of and defaulting on them can have extremely serious legal repercussions. Students wouldn't be able to get the loan without the government helping out. The government is not a bank or for-profit institution. It has a duty to protect its citizens, and by offering them loans that they can't pay back and then making the loans have much higher than normal consequences for defaulting on it is not fulfilling its duty very well.

In any case, we have this crappy setup for higher education and we're stuck with it for now since lobbyists will make sure the system is in place. I see this as a small bone thrown to the citizens to distract from the real problem rather than a windfall.

[chinatwin88]

[JZer]

[jm21]

Chinatwin88,

I am faulting the government for offering large unsecured loans. I would also fault them for getting rid of usury laws. I would also fault them for encouraging the loans that led to the mortgage crisis (making laws that encourage home ownership for those who can't afford it to increase political popularity). I would also fault them with creating and expanding the secondary mortgage markets (we do know that freddie mac and fannie mae were started by the federal government I assume). Perhaps surprisingly, it is not hard for me to blame the government for favoring the banks over the people.

Sorry, I just do not see our government as an altruistic father figure watching over its citizens. Local governments may do a decent job but you won't be able to convince me our politicians, especially those in the federal government, really care about the citizens.

Maybe we should just offer every citizen a government-backed credit card with a $50,000 limit and 50% interest rate that is impossible to default on? I guess that would be a great boon to the citizenry.

JZer,

One of the major consequences of defaulting on a student loan is the loss of certain professional licenses. We're half-way there.

[chinatwin88]

[ClaudeRains]

Wow. I am always amazed at how quickly a simple question pulls the mob off into the marsh of their own separate issues. OP, the answer to your original question is easy. Good news. If you consolidate your loan with the DOE, you can switch to Income Based Repayment. Regardless of how much you owe, your monthly bill is then tied to your income. As long as you don't make over 25K in dollars, you should not pay more than 150 a month. If 20K, not more than seventy five bucks. Less than that, and you will pay nothing. Even if you do pay nothing, it still counts against the 25 year term. Remember, since you are working in China, it's kind of up to you how much you claim you are making when you talk to the DOE.

[SandyG20]

For the OP - If your in default they won't let you consolidate or use any income sensitive plan or apply for more loans. They send it to a collection agency and then they want either all the money now - or very large and I mean large payments - and they tack on huge fees and such - and they want all your bank info and employer info to garnish pay and put liens on your accounts. It won't matter if your homeless, 75 and in a nursing home (they actually garnish social security) or what your circumstances are. I urge people to write to congress and other political types to change the laws and allow income sensitive plans for those in default status. With the economy the state it is in - many people are in default who never were before. The new income sensitive plans just became available and many people were already in default - and the government isn't helping those people. I have also spoken to people that are applying for the income sensitive plans and are not in default - and the government is really dragging it's feet on allowing people into these new plans.