Should Student Loans Be Forgiven or Enforced?

[College#19]

Where do people stand on this issue? I know college tuition/room&board is out of control at a lot of Universities and at the same time it seems the idea of cancelling student loans is penalizing those students who were fiscally responsible with their college choices.

 

[bigblueinsanity_rivals250340]

Even as mostly a free market person, I think several of these loans should be forgiven. Alot of what went on amounts to predatory lending in other arenas.

That said, the entire issue could easily be resolved if they just removed/invalidated the completely unfair super strong bankruptcy protection given to student loans.

For those that don't know, discharging student loans in bankruptcy is virtually impossible because they're given special protection. Get rid of that and the whole issue solves itself

 

[funKYcat75]

I'm all for a one-time only cancellation. I also have a kid in college right now, so I'm a bit biased

I'm not one that thinks college should be free, because some folks just don't need college to do what they want to do, or are not cut out for it. Resources and time could be wasted by folks going to free college just because it's free. It should be cheaper, but not free.

the idea of cancelling student loans is penalizing those students who were fiscally responsible with their college choices.

I reepectfully disagree with the word penalizing. You work within the parameters under which you currently exist. Every single person from the 90s who had college debt would gladly have taken a cancellation and would not give a damn about the folks from the 70s or 80s.

 

[GuyFromKY]

As a college graduate with a hefty student loan balance, I'm all for forgiveness. Expecting an 18-year old kid to know what they want to do for the rest of their lives straight out of high school is a setup for failure. It took me 10 years to figure it out. A lot of changes in majors and different coursework occurred during that time.

 

[funKYcat75]

By the way, it would sure be nice to not read the words "left" "right" "indoctrination", etc. in this thread. Seems like a good thread to hash out a real issue without the usual side-bashing.

 

[GuyFromKY]

By the way, it would sure be nice to not read the words "left" "right" "indoctrination", etc. in this thread. Seems like a good thread to hash out a real issue without the usual side-bashing.

Agreed. This is a right, left and middle issue. No need to take sides.

 

[GuyFromKY]

Where do people stand on this issue? I know college tuition/room&board is out of control at a lot of Universities and at the same time it seems the idea of cancelling student loans is penalizing those students who were fiscally responsible with their college choices.

What about those that had no other choice but to take out student loans to attend college and make a better life for themselves? Not everyone had a grandparent's trust fund waiting on them when they graduated high school.

 

[SDC888]

One time debt jubilee... but you have to fix the root cause.

Which is that it's a con, and you can't just go right back to giving massive loans to people with little prospect of repaying them in a timely manner, if at all, or without significantly altering the trajectory of their lives.

 

[cricket3]

10 years of income based repayment should be sufficient to payoff any federally backed loan. Not just for public service employees but across the board.

On top of that my Stafford loan interest is more than double my mortgage rate. That’s ridiculous.

 

[Ron Mehico]

I went to a lot of universities and had absolutely MASSIVE student debt that I should have paid off by end of this year/next year. It was at 6.7% interest before I refinanced with SoFi. It was ridiculous - you don’t want to know the number, frankly. Although I would be disappointed that I didn’t get it for myself, I think some level of relief/making them eligible for bankruptcy would be a positive.

Here’s my reasoning: it’s incredibly easy to get loans for college. Like ridiculous - you just need to enroll, no questions asked. What this has done is made universities insanely bloated. They know they can get a massive loan from the government for any major. So now universities offer lots of completely pointless majors to literally make money. They have these insanely nice dorms, ridiculous amounts of administration, constant building, etc etc. Its, imo, turned universities into predatory corporations. By making some loans forgiven/eligible for bankruptcy, this now means the government might not get their money back. So that now means they’ll be more cautious/actually give a **** about giving out billions in loans. This will result in them being more critical in giving them out which will cut back on universities offering stupid majors/hiring ridiculous administrators/preying on HS students, etc.

All my opinion from someone who was in higher education in some form or another for 15 years after HS

 

[UKRob 73]

What about those that had no other choice but to take out student loans to attend college and make a better life for themselves? Not everyone had a grandparent's trust fund waiting on them when they graduated high school.

Why should student loans be any different than your car loan, your home loan etc? It's a debt you willingly took on, you should repay it.

 

[blubo]

I paid for my kid’s tuition by working overtime plus my wife working full time. i’m generous but not to the point that i want to kick in any of my hard earned money to pay tuition for deadbeats i don’t even know who don’t want to pay their debts.

 

[MegaBlue05]

It depends.

If a borrower took out a $60K loan, has paid off the principle and then some, but still owes $85K in interest, forgive that amount. Because the remaining balance is essentially theft. I used to work with a girl who started straight out of college. She said if she used her entire paycheck every two weeks to pay on her loans, she’d have them paid off in 15 years. That’s ridiculous.

Generations of young people, my generation included, received terrible advice form our elders that one HAD to go to college to be successful. That was proven to be untrue and left millions of people with debt they’ll never get out from under. Definitely not the best way to begin one’s career. I was fortunate to receive a small scholarship and a couple grants. I “only” needed $15K in loans. Graduated in 2004. Paid them off in 2015. Total spent: $37K. Racquet.

 

[GuyFromKY]

Why should student loans be any different than your car loan, your home loan etc? It's a debt you willingly took on, you should repay it.

That's comparing apples to oranges. If I had it to do over again, I most likely would've went the trade route and made more money than I am now and got on-the-job paid training. For most kids, going to college right after high school is the expectation and sometimes the requirement. Kids are trained and manipulated to think that going to college is the only way to make a good life for yourself. But how am I supposed to pay for college? Well, if you work hard and make good grades, you can earn a few thousand dollars in scholarships. What about the other tens of thousands of dollars I'm supposed to pay? Oh, just take out student loans for that! You don't even have to make payments on it while you are in college. You also get a deferment period after you graduate to help you get settled into your new career. Don't worry about the astronomical interest rate. That's just minor logistics. Now, go get that degree!

Meanwhile, most car loans and mortgage loans are taken out after someone is established and making a decent living. Prices can be negotiated, interest rates are reasonable, and a better understanding of what the loan owner is getting themselves into is obtained. It's a cynical argument to take the approach that it's the same as an automotive loan or a mortgage loan.

 

[cricket3]

I couldn’t afford my accounting degree so I sold it and got a used teaching degree.

 

[funKYcat75]

I'm not sold on loans being used for room and board, to be honest. If you can afford the wild price of it, go for it. If not, live at home, or get a job and a crappy (relatively) cheap apartment.

 

[ukalumni00]

How many people actually know that the same Federal Government that says they are going to fix this mess are the same ones who took it over 10+ years ago? I bet not many. So, that said, there is no way I will ever support the government promoting yet another failed plan to the taxpayers of this country. I along with millions of others worked our asses off and made sound financial decisions to pay our loans off. The con is that they say the debt is "forgiven". No debt is ever forgiven. All debts have to be paid and guess who is going to pay for it. Taxpayers. Why should someone who works hard and will never make anything close to what a college grad will make in their lifetime have to pay more taxes to bail them out? Lots of these kids come from wealthy households. They took out irresponsible loans and now Joe the Plumber has to help bail them out? Yes, I completely disagree with government bailing out corporations. The whole system is a farce.

 

[JumperJack]

Absolutely no way it’s fair.

It’s also criminal that people can rack up 5 figure debt for worthless degrees. That should be reformed.

 

[Ron Mehico]

Absolutely no way it’s fair.

It’s also criminal that people can rack up 5 figure debt for worthless degrees. That should be reformed.

That’s my issue. I don’t see how you reform a college from offering a degree in mid-century French poetry for 85k with 8% interest without hurting the initial loan giver so they think twice about giving the university that money. The only way I see that is making it so the initial loan giver doesn’t get the money which would be forgiveness - I don’t really see any other way.

 

[Beatle Bum]

Forgiveness does not fix the problem. Government created the problem and colleges raped students, because they were paid to do so. I could see reducing debt, but I don’t think taxpayers who sacrificed to pay down their debt or to plan for their kids’ college or who never went to college should be paying the outrageous costs of college for others. Force the colleges to have accountability. Set a flat cost that increases with inflation, rather than greatly outpaces inflation (what we have seen these awesome institutions do over the years, because we have them free money people could not afford) and don’t let them take advantage if they charge more than the government rate.

 

[P19978]

No

 

[funKYcat75]

All debts have to be paid and guess who is going to pay for it. Taxpayers.

Help me out here, honestly. Why would taxpayers have to foot the bill for money already spent? Some of it decades ago? Is it that the money that would normally be coming in from payments and interest would have to be replaced by taxes somehow? I legitimately don't know.

 

[phunterd]

I went to a lot of universities and had absolutely MASSIVE student debt that I should have paid off by end of this year/next year. It was at 6.7% interest before I refinanced with SoFi. It was ridiculous - you don’t want to know the number, frankly. Although I would be disappointed that I didn’t get it for myself, I think some level of relief/making them eligible for bankruptcy would be a positive.

Here’s my reasoning: it’s incredibly easy to get loans for college. Like ridiculous - you just need to enroll, no questions asked. What this has done is made universities insanely bloated. They know they can get a massive loan from the government for any major. So now universities offer lots of completely pointless majors to literally make money. They have these insanely nice dorms, ridiculous amounts of administration, constant building, etc etc. Its, imo, turned universities into predatory corporations. By making some loans forgiven/eligible for bankruptcy, this now means the government might not get their money back. So that now means they’ll be more cautious/actually give a **** about giving out billions in loans. This will result in them being more critical in giving them out which will cut back on universities offering stupid majors/hiring ridiculous administrators/preying on HS students, etc.

All my opinion from someone who was in higher education in some form or another for 15 years after HS

Exactly this. Forgiving student loan debt is treating a symptom of the disease. First we must cure the disease.

 

[BlueBallz_rivals30790]

I don't think they should. There are many that have been, even at a young age, fiscally responsible about it. For those that didn't take out (or took minimal) student loans, worked while in college, summers, saved, etc. What about them? Should they get paid back? What about those that already paid their student loans, should they get that back? My niece has $10k left on her student loan and could certainly pay it back but is waiting to see if it will be forgiven. When I was in college, I worked as well, would get a 2 bedroom apartment where we had 4 of us piled in. There were also those that would go the community college route for a year or two and transfer, or GI bills, etc. so there are options.

 

[cricket3]

I’ve made monthly payments that total amount the government loaned me. I still have thousands of dollars to pay back.

 

[jwheat]

Why stop at student loans? Is it because it’s mostly liberal students that have trouble paying off their loans?

if you pay off Student loans for one group why not a house or vehicle for those who went straight to work?

 

[cricket3]

Because we’re specifically talking about high interest federally backed loans.

 

[Beatle Bum]

Help me out here, honestly. Why would taxpayers have to foot the bill for money already spent? Some of it decades ago? Is it that the money that would normally be coming in from payments and interest would have to be replaced by taxes somehow? I legitimately don't know.

This may be unconstitutional. The guaranteed student loan was not instituted as a free college education plan. The president is essentially budgeting taxpayer money without the approval of Congress.

 

[Beatle Bum]

By the way, this is easy for “economists” who believe the government can spend whatever it pleases because it prints money. Perhaps just forgive the interest.

 

[bigblueinsanity_rivals250340]

Why should student loans be any different than your car loan, your home loan etc? It's a debt you willingly took on, you should repay it.

Its entirely different. There is underwriting that goes on in those loans but zero that goes on in student loans. Also if something happens you can get bankruptcy relief from those loans. Nearly impossible with student loans.

Make them dischargeable in bankruptcy and the entire problem solves itself. There really is no justifiable reason they're given such lofty protection.

 

[_Mav_]

Sure, let's forgive them -- and while we're at it we oughta raise the minimum wage to eleventy billion dollars an hour.

 

[Blue_2_the_bone_rivals]

I’m on the fence about it. On one hand, if you borrow money it’s your responsibility to pay it back. On the other, when the federal government got into the student loan business, they conditioned and preyed on kids coming out of high school with ridiculous interest rates and putting them straight into debt while they ship Billions to countries that hate us, people who come here illegally, people who refuse to work, and so on. It would be nice to see some grace for those who actually work and contribute to society and pay taxes. If a student only took out the money necessary for classes and tuition I can see it being forgiven. If they took huge loans to party and never finished a degree, I believe it should be paid back at a reasonable interest rate and payment. Just my opinion.

 

[UKRob 73]

It depends.

If a borrower took out a $60K loan, has paid off the principle and then some, but still owes $85K in interest, forgive that amount. Because the remaining balance is essentially theft. I used to work with a girl who started straight out of college. She said if she used her entire paycheck every two weeks to pay on her loans, she’d have them paid off in 15 years. That’s ridiculous.

Generations of young people, my generation included, received terrible advice form our elders that one HAD to go to college to be successful. That was proven to be untrue and left millions of people with debt they’ll never get out from under. Definitely not the best way to begin one’s career. I was fortunate to receive a small scholarship and a couple grants. I “only” needed $15K in loans. Graduated in 2004. Paid them off in 2015. Total spent: $37K. Racquet.

You couldn't pay off $15k any quicker than 11 years? I find that hard to believe.

 

[JumperJack]

That’s my issue. I don’t see how you reform a college from offering a degree in mid-century French poetry for 85k with 8% interest without hurting the initial loan giver so they think twice about giving the university that money. The only way I see that is making it so the initial loan giver doesn’t get the money which would be forgiveness - I don’t really see any other way.

I think there should be a movement towards making loan forgiveness much easier to get for the most needed professions. The taxpayer would probably be glad to pay loans for doctors and engineers. It should be clear that if you choose to major in something unemployable, you’re on your own. Doing that would force people to think twice.


There’s a handout mentality involved here which does force politics into it, unfortunately.

 

[UKRob 73]

Its entirely different. There is underwriting that goes on in those loans but zero that goes on in student loans. Also if something happens you can get bankruptcy relief from those loans. Nearly impossible with student loans.

Make them dischargeable in bankruptcy and the entire problem solves itself. There really is no justifiable reason they're given such lofty protection.

We all know the difference. The fact is, it's still an amount of money you borrowed. Why should you not have to pay it back?
You also took the loan knowing bankruptcy wasn't an option. And when you say they get " such lofty protection". Their only protection is that you have to pay the money back that you borrowed. I think every type of loan should have that protection.

 

[funKYcat75]

You also took the loan knowing bankruptcy wasn't an option

When I was 18 I would not have understood that. I'm fairly certain most kids today wouldn't either. Maybe I'm wrong. The only thing I remember from entrance counseling was that I suddenly had to write in cursive again.

 

[UKRob 73]

Help me out here, honestly. Why would taxpayers have to foot the bill for money already spent? Some of it decades ago? Is it that the money that would normally be coming in from payments and interest would have to be replaced by taxes somehow? I legitimately don't know.

Currently about $1.5 trillion is owed in student debt. Those monthly payments make up the majority of what funds future loans. The rest is allocated by Congress annually from taxpayers money.
So yeah if you forgave all, or even a large portion of the $1.5 trillion, you either need taxpayers to fill that gap, or the student loan program goes under.

 

[funKYcat75]

Currently about $1.5 trillion is owed in student debt. Those monthly payments make up the majority of what funds future loans. The rest is allocated by Congress annually from taxpayers money.
So yeah if you forgave all, or even a large portion of the $1.5 trillion, you either need taxpayers to fill that gap, or the student loan program goes under.

That makes sense. Thanks.

 

[bigblueinsanity_rivals250340]

When I was 18 I would not have understood that. I'm fairly certain most kids today wouldn't either. Maybe I'm wrong. The only thing I remember from entrance counseling was that I suddenly had to write in cursive again.

Most adults don't even know that. Many are shocked to learn those loans are given such special treatment.

 

[jwheat]

Because we’re specifically talking about high interest federally backed loans.

Stop federally backing loans