Posted on 08/11/2024 6:35:44 AM PDT by karpov
Legal battles over President Biden’s various schemes to forgive student debt continue. In July, the Eighth Circuit Court of Appeals indefinitely blocked the administration’s ultra-generous new student-loan repayment plan, which could have cost taxpayers $475 billion. Additional loan-cancelation initiatives—also certain to face legal challenges—are in the works.
But the high drama of loan cancelation has drawn attention away from a more pressing issue in the student-loan system. After the pandemic-induced student-loan payment pause ended last year, the Education Department implemented a one-year transition period to allow borrowers time to ease back into the habit of paying their loans. That so-called on-ramp is set to expire at the end of September—yet tens of millions of borrowers have not yet made a payment.
During the payment pause, no federal student-loan borrower had to make a payment, and interest rates were set at zero. During the on-ramp, payments are due and interest accrues once again. But borrowers who don’t pay their loans can avoid the worst consequences of failing to do so: Delinquencies will not appear on their credit records, nor will loans be placed in default or sent to collections.
Since most student borrowers had not made a payment on their loans for over three years, the logic of a one-year on-ramp was to allow borrowers time to make financial arrangements to recommence payment. Missing a payment or two would be no big deal. After a year, the logic ran, most borrowers should be comfortably paying their loans every month.
That ideal couldn’t be farther from reality. At the end of 2019, prior to the payment pause, 3.1 million borrowers were more than 30 days behind on their loan payments. As of March 2024—the latest month for which data are available—the number of delinquent borrowers had reached 7.3 million.
(Excerpt) Read more at jamesgmartin.center ...
I think you need to re-read what I wrote! Since I was only talking about the federal student loan we’re essentially in agreement.
“Delinquencies will not appear on their credit records, nor will loans be placed in default or sent to collections.”.
Given that, why would any sane person repay the loan?
No consequences if you don’t.
It's sickening to think so many college “educated” people are probably going to vote “D” from here on in, as was the plan all along, I believe. Added to the millions of ILLEGAL invaders already in the country probably getting to vote, the election would be totally corrupted, moreso than the last election.
“Delinquencies will not appear on their credit records, nor will loans be placed in default or sent to collections.”
I would call that “loan forgiveness by another name” .
So the only consequence of not paying the loan is that you might get a bill in the mail or email that you just toss in the trash can.
The school gets the cash...You can’t have it both ways.
That phrase says it all.
It wasn’t the “professor” making bank, it was the multitude of administrators. Otherwise I really don’t care. Trillions for wars, trillions for illegals, trillions for bums….
I paid for my 3 kids. 1 scholarship, 2 did 2 years at JUCO + 2 years at reasonable price state schools. Ex-wife wanted them to go to pricey schools and get the college experience. All so she could say my kids go to xyz like the idiots she worked with. 30K-40K per year parental bragging rights and kids in dept to their eyeballs. The cost would have killed them because I could not afford it and neither could she. Hence why she is an Ex.
People are stupid and mostly think short term and way overestimate the long term value.
The change Congress made in the bankruptcy law so that student loan debt is non-dischargeable.
If student load could be written off in bankruptcy, then most of the current student loans never would have been made in the first place. You would either pay cash for your "Studies" degree, or you would study something useful, or you would go to work.
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