Obamacare STUDENT LOAN STUPIDITY!!!

[GHook93]

i found this on student loans from a few years ago...

President Bush made clear that funding programs for students in school such as the Pell Grant would take a higher priority than assisting students after they’ve completed their education. In the Office of Student Financial Assistance Budget, student loan consolidation has been earmarked for a cut from $ 34.7 billion to $ 25.3 billion, a loss of $ 9.4 billion. In addition, the 2006 Budget proposes three major changes to the student loan consolidation program:

First and most important, the 2006 budget proposes replacing the fixed rate benefits of student loan consolidation with a variable rate formula equal to current loan balances. This would mean that students, currently locking in rates of 2.875%, would end up with variable rate loans that could reach as high as 8.25%, a potential 300% increase in rates.

Second, the budget proposes allowing students to reconsolidate their student loans at a fee of 1% of their loan balance. For graduate and medical students, who often have loan balances of $ 100,000 or more, this could translate to reconsolidation fees of thousands of dollars; currently, students pay no fee for any kind of student loan consolidation.

Third, the budget proposes doubling the fees that lenders are charged, from 0.5% to 1.0%. As lenders will need to absorb a doubling of their loan origination costs, benefits such as interest rate discounts offered to graduates may decrease or be eliminated. Additionally, because of the $ 9.4 billion proposed cut, lenders will need to search for ways to recoup the loss of federal funds, either by making consolidation requirements more stringent (i.e. requiring higher loan balances) or reducing benefits.

read the rest here: Drastic Student Loan Consolidation Changes in Proposed 2006 Federal Budget | Student Loans Easy

this could be the 1% that is added that gh spoke about?

There were three drastic changes to student loans:
(1) Under the Republican Congress that Clinton signed into making student loans nondischargable. Which created the largest increases in college tuitions in US history. Colleges could skyrocket tuition and lenders would write the loans with no fear of BK discharge.
(2) Under Bush, which made private student loans nondischargable also.
(3) Under Obamacare, which Federalize all student loans, including consolidation!

 

[GHook93]

Oh, and when the students default the government buys up the loans and tries to collect them, thereby protecting the bank...with very limited success in collecting from the defaulters.

So yeah, ghook should quit whining and thank our social programs for underwriting his ungrammatical ass.

Where does the government get the money to lend out to begin with?

Who ultimately pays when government fails to collect from defaulters?

Why is government even in the business of loaning money anyway?

Those are separate questions. I'm am merely laughing at ghook for whining about his government handout.

Hey fat stuff, there is a BIG difference from federally backed student loans and the government doing direct to student lending. Get the hoe hoes out of your ears!

 

[GHook93]

Gh hook needs to prove it was the changes that took place in Obama care, by providing a link....cuz that article that i linked to says the changes were made in 2006.

I agree proof should be provided, but keep in mind I didn't read about it I experienced it directly. It's 100% the truth!

http://washingtonexaminer.com/node/1081510

Information on Obamacare and Student Loans - College Confidential

ObamaCare Includes Provision To Takeover Student Loan Program

Will Dems add student-loan takeover to ObamaCare? « Hot Air

Obama Arrogance: Federalized Student Loans attached to Senate ObamaCare Reconcilation ramjob | VotingFemale

 

[Ravi]

Where does the government get the money to lend out to begin with?

Who ultimately pays when government fails to collect from defaulters?

Why is government even in the business of loaning money anyway?

Those are separate questions. I'm am merely laughing at ghook for whining about his government handout.

Hey fat stuff, there is a BIG difference from federally backed student loans and the government doing direct to student lending. Get the hoe hoes out of your ears!

Yeah...it would be cheaper without the profit making middle man.

Either way...you are whining about a social program that you have benefited from. Very amusing.

 

[Care4all]

Gh hook needs to prove it was the changes that took place in Obama care, by providing a link....cuz that article that i linked to says the changes were made in 2006.

I agree proof should be provided, but keep in mind I didn't read about it I experienced it directly. It's 100% the truth!

http://washingtonexaminer.com/node/1081510

Information on Obamacare and Student Loans - College Confidential

ObamaCare Includes Provision To Takeover Student Loan Program

Will Dems add student-loan takeover to ObamaCare? « Hot Air

Obama Arrogance: Federalized Student Loans attached to Senate ObamaCare Reconcilation ramjob | VotingFemale

I've gone in to all the links GH, and I don't see anything that relates to the consolidation problems you are having...can you point to the legislation that relates to your refinancing problems?

I don't doubt that you are having problems first hand, I have no reason to doubt you on this....

I just do not see any legislation that relates to your circumstance other than the student loan consolidation reform that took place in 2006.

 

[Zoom-boing]

It's a handout like social security is a handout. So yeah republicans hate them. I actually think the law helps alot and gets rid of an unnecessary middle man. Saves people the hassle and money.

How do you figure that social security is a handout? People pay into social security their whole lives; they don't pay into some kind of 'student loan fund'. Where does the government get the money to loan in the first place? And it gets paid back with interest so how is it a handout?

As for the middle man, the majority of money that is being saved by eliminating the middle man has been put into Pell Grants. Grants are monies that are not returned like a loan. It's money that is given away -- a true handout.

They eliminated the middle man to save lots of money just to turn around and give the majority of the savings away.

 

[GHook93]

It's a handout like social security is a handout. So yeah republicans hate them. I actually think the law helps alot and gets rid of an unnecessary middle man. Saves people the hassle and money.

First, most people right or left support social security. The question there is not whether or not to have it, but how to fund it! Same with medicare and medicaid!

Second, the intent is to get rid of the unnecessary middle man and save students money. And if it worked that what I would be all for it. But it doesn't work that way. In fact, the only thing they will accomplish is getting rid of the middle man. But the students and their parents will get less favorable rates and terms. No flexibility and the ones with federal loans from private lenders won't be able to consolidate. This will also greatly increase the deficient. Before it was private banks and lending institutions lending their non-taxpayor dollars and the Fed backing them if the student defaults. Now it's 100% coming from the fed!

 

[GHook93]

Those are separate questions. I'm am merely laughing at ghook for whining about his government handout.

Hey fat stuff, there is a BIG difference from federally backed student loans and the government doing direct to student lending. Get the hoe hoes out of your ears!

Yeah...it would be cheaper without the profit making middle man.

Either way...you are whining about a social program that you have benefited from. Very amusing.

First, if it was cheaper and more efficiently done by the new way I would be all for it, but maybe you should talk to a parent whose kid is going to college now and ask them about the process and rate. Just like everything the government does the waste, poor management and over-staffing 100 fold defeats any cost savings of monetary benefits of cutting out the private sector benefits.

Ask people in the business, student lending is a MESS!

Second, when have I stated I was against all "government handouts" or "entitlements?" There are some I like. Preferably when the use the private sector to implement the programs. A great example was cash for clunkers. That federal handout revitalized the auto industry, which is essential to the American economy. I am also for the $7,500 federal tax rebate for buying hybrid or electric cars!

 

[Ravi]

Hey fat stuff, there is a BIG difference from federally backed student loans and the government doing direct to student lending. Get the hoe hoes out of your ears!

Yeah...it would be cheaper without the profit making middle man.

Either way...you are whining about a social program that you have benefited from. Very amusing.

First, if it was cheaper and more efficiently done by the new way I would be all for it, but maybe you should talk to a parent whose kid is going to college now and ask them about the process and rate. Just like everything the government does the waste, poor management and over-staffing 100 fold defeats any cost savings of monetary benefits of cutting out the private sector benefits.

Ask people in the business, student lending is a MESS!

Second, when have I stated I was against all "government handouts" or "entitlements?" There are some I like. Preferably when the use the private sector to implement the programs. A great example was cash for clunkers. That federal handout revitalized the auto industry, which is essential to the American economy. I am also for the $7,500 federal tax rebate for buying hybrid or electric cars!

My kids are in college...and so was I, once upon a time. We didn't take government handouts to pay for anything.

 

[Sheldon]

The feds loaned you the money and you paid them back. Simple. No interest required, because your becoming an educated working tax payer is how the government earned it's interest.

I wish that was how it worked today.

 

[Mustang]

I decided to look into today to consolidating my student loans, because after looking at some of the interest rates. I have some low ones at 2.47 and some high ones at 8.5. My current lender said that they can't consolidate anymore (neither can any private company in the country either), so you have to go to the department of education.

In the past, before Obamacare, you would go to your lender (or another lender) consolidate your loans, get a lower rate and a better term. You would shop around, like you do with mortgages, credit cards, auto loans etc.! That is what it used to be!!!

NOT anymore with the Obamaloanstore. What they do now is take a weighted average of your student loans interest rates and give you a weighted average (interest rate (meaning they take the average and then raise it a little). OK, so if I go in with a 2.47 and 8.50. The average is 5.49, then they add on to that and get it to 6.49. That is a deal only a liberal could like. Say I go in with four 8.5% loans, I get a 9.5%! So where is the benefit? The answer? There is none. ZERO!!! This is the only place you can go to for consolidation! THEY GAVE THE FEDERAL GOVERNMENT A MONOPLY AND A LICENSE TO FUCK PEOPLE! Obama is a fucking moron!

He federalize the student loan market and trying to say its a better. Really students are now snow-job! They can't consolidate. They can't get a better rate or payment. There are no options! NONE. I am suck paying a 8.5% when rates are at there lowest point in HISTORY! WTF!

Great question would be at this point, is why is a healthcare law making the worst and most drastic change to student loans!

My understanding of how the gov't guaranteed student loan system previously worked is this: The gov't would agree to guarantee loans made by banks to students. This was a very good deal for students, and it was a FANTASTIC deal for the banks. Because when the loans were paid back, the banks made a profit. But when students defaulted, the banks lost nothing since the loans were guaranteed, essentially by the taxpayers. The banks made money with essentially no risk. By changing the system, the taxpayers are no longer be used by the banks to eliminate any and all risk to the banks. And it sounds like you can still consolidate your loans and get a lower rate, not to mention that you will get the education that you would not have been able to afford without the loans. Congratulations on that dual benefit. Why you're complaining is a mystery to me. Or are you one of those freeloaders who wants something for nothing?

 

[hipeter924]

Yeah...it would be cheaper without the profit making middle man.

Either way...you are whining about a social program that you have benefited from. Very amusing.

First, if it was cheaper and more efficiently done by the new way I would be all for it, but maybe you should talk to a parent whose kid is going to college now and ask them about the process and rate. Just like everything the government does the waste, poor management and over-staffing 100 fold defeats any cost savings of monetary benefits of cutting out the private sector benefits.

Ask people in the business, student lending is a MESS!

Second, when have I stated I was against all "government handouts" or "entitlements?" There are some I like. Preferably when the use the private sector to implement the programs. A great example was cash for clunkers. That federal handout revitalized the auto industry, which is essential to the American economy. I am also for the $7,500 federal tax rebate for buying hybrid or electric cars!

My kids are in college...and so was I, once upon a time. We didn't take government handouts to pay for anything.

'Free University' worked here for a while, then some corrupt politicians came back from their life on the taxpayer overseas, instituted some policies to make themselves and their best buddies rich and ruined the system. To put it bluntly, free education works so long as people have the money to pay for it, and when the courses offered improve the economy and give people jobs. Unfortunately most universities these days are looking for the dollar sign, and perfect grade averages rather than getting people into work and paying their debt off.

 

[kiwiman127]

Government is not there to take care of your personal responsibility... whether it is 'simple' or not

Adults should bear the burden of the costs of things they want

Another swipe at the working class! If things followed your path, no one who didn't come from money would have a chance at a higher education.
Why do some people want America to be just plain uneducated and unable to compete in the international economy?
Also, way to address Beowolfe 100% accurate statement that the GOP are the ones who really screwed things up regarding student loans.

How is it a swipe at the working class to call for personal responsibility for the expenses of ones own wants and needs?

Explain why you are owed something from government or others for simply existing? Whether it be an entitlement or loan...

Nobody wants America to be uneducated... simply for you to work and pay for the education you want as an adult... whether it be thru your own savings, family help, loans, work benefit compensation, military GI Bill or college fund, or whatever else.... but the key is that it is YOUR responsibility to get it thru your own means and it is not anyone's responsibility to simply have it owed to you (as a government program makes it)

When I went to college, I used student loans and worked 20-30 hours a week. If I had not done this I would have never been able to finish college because of lack of funds. I've been there and done that.

Since that time, the cost of education has increased much more than the inflation rate. Also, it's a fact that Working Class/Middle Class wages have been flat since the 1980's. This means that fewer and fewer wage earners can send their kids to college because their expendable income has decreased. Student loans give many more people the opportunity to get an education and encourages more people to geta higher education.
Higher education has priced itself out of reach for most of the Middle Class. That's reality.

 

[Zoom-boing]

 

[boedicca]

Any time the government interferes in the private sector, it drives up cost and drives down quality.

I just got my earthquake insurance bill in the mail. Before the State "statized" earthquake insurance, premiums were around 30% of our standard property insurance. Now, thanks the to state destroying private insurance, earthquake insurance premiums are more than double the standard property policy.

I'm tempted to drop coverage, but would rather not take the risk.

 

[boedicca]

Regarding the cost of a college degree. I read an article a few months ago regarding the net present value of a bachelor degrees. Back before the insane higher education price inflation,

the incremental increase in lifetime wages for somebody with a BA was approximately $1M, with a net present value of $200K. The higher education industry has completely extracted that NPV from many college students, as they do not have the earning power to increase their incomes to compensate for the cost of their degrees.

 

[gekaap]

Let's be honest, a great many things have become increasingly, ridiculously expensive over the past few decades, in comparison to what they used to be. What's your cable bill now compared to 15 years ago? What's gas now compared to 15 years ago? What's a doctor's bill now compared to 15 years ago? What's a cell phone bill now compared to 15 years ago? All of these things are three to four times as expensive now, and have increased well ahead of the rate of inflation. Hey, what's a CEO's salary now, compared to 15 years ago? What's yours?

 

[boedicca]

It's a handout like social security is a handout. So yeah republicans hate them. I actually think the law helps alot and gets rid of an unnecessary middle man. Saves people the hassle and money.

How do you figure that social security is a handout? People pay into social security their whole lives; they don't pay into some kind of 'student loan fund'. Where does the government get the money to loan in the first place? And it gets paid back with interest so how is it a handout?

As for the middle man, the majority of money that is being saved by eliminating the middle man has been put into Pell Grants. Grants are monies that are not returned like a loan. It's money that is given away -- a true handout.

They eliminated the middle man to save lots of money just to turn around and give the majority of the savings away.

Unfortunately, SS is an entitlement. It's not like the tax we pay is saved and invested in an account for us. The money is spent on current beneficiaries...and when (if) we collect benefits, they will be funded by taxes on workers at that time.

It's also important to note that benefits are not guaranteed. Congress can change them at any time.

We'd be better of with a Chilean type of system in which individuals own their accounts, having the ability to pass them to heirs after death - and with the added benefit of not being available for raiding by politicians to spend on other programs.

 

[GHook93]

I decided to look into today to consolidating my student loans, because after looking at some of the interest rates. I have some low ones at 2.47 and some high ones at 8.5. My current lender said that they can't consolidate anymore (neither can any private company in the country either), so you have to go to the department of education.

In the past, before Obamacare, you would go to your lender (or another lender) consolidate your loans, get a lower rate and a better term. You would shop around, like you do with mortgages, credit cards, auto loans etc.! That is what it used to be!!!

NOT anymore with the Obamaloanstore. What they do now is take a weighted average of your student loans interest rates and give you a weighted average (interest rate (meaning they take the average and then raise it a little). OK, so if I go in with a 2.47 and 8.50. The average is 5.49, then they add on to that and get it to 6.49. That is a deal only a liberal could like. Say I go in with four 8.5% loans, I get a 9.5%! So where is the benefit? The answer? There is none. ZERO!!! This is the only place you can go to for consolidation! THEY GAVE THE FEDERAL GOVERNMENT A MONOPLY AND A LICENSE TO FUCK PEOPLE! Obama is a fucking moron!

He federalize the student loan market and trying to say its a better. Really students are now snow-job! They can't consolidate. They can't get a better rate or payment. There are no options! NONE. I am suck paying a 8.5% when rates are at there lowest point in HISTORY! WTF!

Great question would be at this point, is why is a healthcare law making the worst and most drastic change to student loans!

My understanding of how the gov't guaranteed student loan system previously worked is this: The gov't would agree to guarantee loans made by banks to students. This was a very good deal for students, and it was a FANTASTIC deal for the banks. Because when the loans were paid back, the banks made a profit. But when students defaulted, the banks lost nothing since the loans were guaranteed, essentially by the taxpayers. The banks made money with essentially no risk. By changing the system, the taxpayers are no longer be used by the banks to eliminate any and all risk to the banks. And it sounds like you can still consolidate your loans and get a lower rate, not to mention that you will get the education that you would not have been able to afford without the loans. Congratulations on that dual benefit. Why you're complaining is a mystery to me. Or are you one of those freeloaders who wants something for nothing?

The previous system worked exactly how you stated and was the prime reason tuition increases since the late 90s have been the largest increase in US history, even including inflation increases. The new system, allows consolidation, but not for a lower rate. Rather it allows it at an inflated med-rate. Regardless of what interest rates are now. So say interest rates are at 5.0 your first 5.0 your second yr, 6.0 you last tow years. Then you go to consolidation and rates currently are at 3.0! You can't take advantage of those low rates. What happens is they take the medium of your rates, which in this case would be 5.5% and then inflate it (adding a little onto to it) meaning that 5.5 will go to 6.0%.

Old system had horrendous consequences of skyrocketing tuition. However, this new system is NOT the answer. It will make thinks 10 fold worse!

 

[Polk]

Good question good question indeed!

This student loan reform was part of the Obamination bill. It was written directly into the bill.

Yes, it was. How quickly they forget, huh?

I asked the same thing a while back when all my private student loan consolidation customer were going out of business. Education Direct, Next Student etc. These guys spent over $100K annually with me. They were gone nearly over night. I said "when was this bill passed?" The answer, "It was part of Obamacare." My reply,"What the hell does student loans have to do with healthcare!"

It wasn't part of the health care bill. It was part of the reconciliation amendments to the health care bill.