Federal Student Lending/Delinquency Swells

Discussion in 'Economy' started by Trajan, Nov 28, 2012.

  1. Trajan
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    Trajan conscientia mille testes

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    so who's surprised at this?? Make something easier to obtain, abrogate responsibility, let the Feds run it.....viola' for silliness and fiscal pain.

    My daughter tells me of friends and hears stories of students who use the Pell grant to pay their Comm. college tab then take loans for $ 3-4K per semester as pocket money, while running up CC debt to boot.:doubt:



    Updated November 28, 2012, 11:48 a.m. ET

    Federal Student Lending Swells

    snip-
    U.S. student-loan debt rose by $42 billion, or 4.6%, to $956 billion in the third quarter, the Federal Reserve Bank of New York said Tuesday. Overall household borrowing fell during that period.

    Payments on 11% of student-loan balances were 90 or more days behind at the end of September, up from 8.9% at the end of June, a rate that now exceeds that for credit cards. Delinquency rates for all other consumer-debt categories fell or were flat.


    [​IMG]

    Nearly all student loans—93% of them last year—are made directly by the government, which asks little or nothing about borrowers' ability to repay, or about what sort of education they intend to pursue.

    President Barack Obama championed easy-to-get loans during the campaign, calling higher education "an economic imperative in the 21st century." A spokesman for Education Secretary Arne Duncan said the goal is "to make student loans available to as many people as possible," and requiring minimum credit scores would block many Americans from going to college.

    But rising student-debt burdens and stories about students and parents drowning in debt, coming just a few years after aggressive mortgage lending triggered a financial crisis, is focusing attention on risks to the government and borrowers.

    "Is there any way the federal government could possibly come out to the good?" Sen. Bob Corker (R., Tenn.) asked at a Senate Banking Committee hearing in July on student loans, noting that the government demands no collateral and has no underwriting requirements. "What we're really doing is piling up debt down the road the same students are going to have to pay off."

    Others are asking whether the government is encouraging students to take on too much debt. "The way the system works now…put money on the stump, people come and get it," said Anthony Carnevale, director of Georgetown University's Center on Education and the Workforce. "Can't blame them. It's sitting out there in plain view. It's easy to get."

    more at-
    Federal Lending Push Swells Student Debt - WSJ.com
     
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  2. AmyNation
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    AmyNation Road Warrior Supporting Member

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    Student loans prey on the young and stupid. They encourage you to take large loans every seamster. 18 years olds don't know squat about interest and they all think "of course I"ll have a great job after college". :rolleyes:

    Student loans are for life, you can't ever get rid of them, and they will dock your pay and take your tax returns until its paid off.
     
  3. Soggy in NOLA
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    Soggy in NOLA Platinum Member

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    What a plan.. "here's some money, get a good education so you can be successful, then when you succeed, I'll tax you at a confiscatory tax rate... and oh yeah, vote for me!!!!!"

    And they did...
     
  4. Dont Taz Me Bro
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    Dont Taz Me Bro USMB Mod Staff Member Gold Supporting Member Supporting Member

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    This is not surprising. The same principles that caused the housing crash is driving this too. People never learn.
     
  5. Dreamy
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    Dreamy Silver Member

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    Crazy!

    And the myth or illusion about what a 4 year degree will get you in this economy continues.

    Student loan debt nears $1 trillion: Is it the new subprime?

    http://www.mumbainews.net/index.php/sid/211020365/scat/3a8a80d6f705f8cc
     
    Last edited: Nov 28, 2012
  6. elvis
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    elvis BANNED Supporting Member

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    This is the next bubble, if you will.
     
  7. Soggy in NOLA
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    Soggy in NOLA Platinum Member

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    Problem is you have these idiots getting Ph D's in Druid Philosophy and Post Bolshevik Vagina Studies and other such mindless drek.

    Engineering majors are doing just fine.
     
  8. Zoom-boing
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    Zoom-boing Gold Member

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    One of my daughter's friends, 'V', that she graduated with this past May, borrowed every single dime for school. Private college, lived on campus three years, commuted the past year ... she did this because this is what my daughter did. And yes, I mean V went to this school because my daughter and another girl they both went to high school with went here. V also commuted her last year because my daughter did. :rolleyes: V's parents - financially inept and I'm being nice when I say that - never once said to her "you/we can't afford this school". Her last year of college her parents said they wouldn't co-sign anymore loans for her so she had someone she worked with co-sign. :eek:

    V moved out to California a few months back. She, my daughter and the other girl were all tv/film majors so moving to CA seems like a good idea, right? Well, she moved there because her boyfriend decided he wanted to go to music school there so V followed him. She does have a job ... working at Walgreens. She transferred from the Walgreens here. She doesn't even have a resume put together. She's in freaking California and is a tv/film graduate. Knowing her (she was a 'slider' in school, was the type who road on the coat tails of others, and gained the sympathy of teachers (oh woe is me, this and that happened which is why my assignment is late/incomplete, blah, blah, blah) to ease out of assignments, etc) she will do nothing with this degree, she will remain at Walgreens while in CA.

    Student loans have to start being paid back starting next month. ONE of her loans is $1,100 per month. She posted on Facebook a few weeks back and her total loans equal close to $100,000. I do not foresee her ever paying these loans back in full, I don't see how she will even manage paying back a few months worth. And there are many, many more "V"s out there.
     
  9. jillian
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    jillian Princess Supporting Member

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  10. Dreamy
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    Dreamy Silver Member

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    I used that because the original link was not working. Just an FYI Jillian. Not all links are the actual source of the news. They just carry the news. Put the actual headline I posted in a search engine of your choice and you will find the original link and source. Hope that helps you with your concern about the source.

    No Jillian I do not think people should be educated, well just rich people. Dear gawd, are you for real? I took out student loans and paid them off myself and also have a college degree so what do you think lady? Notch up your game and stop asking me ridiculous lamebrain questions.

    Now are you able to actually discuss this topic which is hardly a partisan issue. It is troubling for all.
     
    Last edited: Nov 29, 2012

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