Posted on 04/01/2009 9:40:35 AM PDT by Arguendo
Im about to talk about two little words that make most people cringe. The mere mention of these words usually incites the same reaction in everyone: a) fear b) denial c) a throbbing headache and d) the desire to run away screaming and crying and begging to go to a happy place. Yes, I am talking about STUDENT LOANS. If you dont have one, you know someone who does and you sympathize with them. In the midst of the credit crisis, home foreclosures and bailout turmoil, the amount of debt that graduates are facing is overwhelming.
I am 23-years-old, two years out of college and I am sitting on $115,000 of student debt. And based on my lenders loan terms, I only have roughly 12 years to pay it off. How much does that make my monthly payment, you ask? A whopping $1,200 a month. And lets just say my lifelong dream career in television doesnt lend itself to that. The only option my bank is giving me is to go on graduated repayment plan. That means that for four years I will only be paying off the interest every month. How much is that? Well, $115,000 with interest rates between 4-8% thats about $600 a month and that doesnt even touch the principal amount. People dont pay off houses in 12 years and I am expected to pay off this student loan in an entry level position?
Some might say, Sam, you shouldnt have gone to a private school in New York City if you wouldnt be able to pay it off. Well, I made a lot of mistakes when signing up for my loans, but I was uneducated on the process and on the repayment and now Im stuck.
(Excerpt) Read more at ac360.blogs.cnn.com ...
Much better!
He needs you for rewrite.
I disagree with the reasons that have been given as to why the loans were made non-dischargeable. I do not disagree that those claims may have the reasons that were given.. I suspect they were, and I have a vague recollection of the arguments at the time that is consistent with that.
Yet I was also a borrower. Not a lot. About $10,000 debt after four years graduating in 1976, my starting salary was $12,000, as a systems analyst. That would be equivalent in burden and salary to say, a systems engineer of today with a debt burden of $50,000, and a starting salary of $60,000. My debt was dischargeable, iirc. My debt was higher than many at the time, so I believe. Had my family and personal circumstance been equivalent and were I to have graduated today I estimate my debt burden would be $85,000. Yet I did not default, nor did I hear of any acquaintances who defaulted, nor did any bank or school representative ever mention or allude to any wide-spread defaulting.
A few years ago I worked in debt collections. I did some research into the business, specifically the history of credit cards, I also followed the recent changes in bankruptcy law closely as they were before the legislature.
Over the course of many years I have made the acquaintance of a number of high-level lobbyists and public relations experts and had discussions about how issues are presented to Congress and the public.
On the basis of those studies, jobs and personal observations I have come to the opinion that when major industry groups come before Congress the motives and the issues they present at face do vary considerably from the prime motives and twists of the issues that most interest the industry.
It’s likely that some number of professionals did default via bankruptcy on student loans. Yet it is more likely, in my considered opinion, that the banking industry made more of that than it was. After all bankruptcy is a legal PROCESS. No creditor is without standing in a bankruptcy — if the creditor has reason to believe that the creditor is pursuing a fraud of a bankruptcy, that claim can be heard and considered in the bankruptcy court!
Yet short-sighted greed is a stronger motive, a constant of human motivation. Aesop’s Goose That Laid The Golden Egg, among other ancient wisdoms tell the tale. The goose is killed for the immediate golden egg, greed shortens the view — acts as a focusing motive! Over-focusing.
Never forget that about humans.
There are plenty of despicable deadbeats who borrow what they NEVER intend to repay. But what I learned in debt collections is that most people will pay, except that they hit temporary hard times. The hard cases, the real bums and cheats are few and far between.
I guess I can say my experience says in a gut check summary that not that many students were defaulting.
Thank you. I knew it was Juris Something...
Sallie Mae in the extra bedroom ping.
Thanks Hoosier for the ping.
I sympathize with anyone that has student loans, but I don’t sympathize with authors writing articles filled with complaints about situations that she needs to buckle down and fix. $115K in student loan debt? That’s pure insanity!
BTW, I kicked the USDEPT of Ed out of my house last fall! Good riddance.
Dave Ramsey Fan Ping List.
If you would like to be added to the “Live like no one else, so that you can LIVE like no one else” list, feel free to Freepmail me.
This student missed the day at school that ?”indentured servant” was defined.
“i want to be on the DR ping list! :)”
Welcome aboard! ;-)
Thank you! DR rocks!
He certainly has rocked my world! I thank God daily for Dave’s ministry.
I’m sorry your son is a diabetic. I am now a type II insulin dependent now myself. You know I wasn’t talking about cases like his, right? He sounds like a fine young man and I wish you both the best!
We’re cool! :)
I was just pointing out that the military isn’t a viable option for many young people. (Although a good option for others... right now.)
Depends. I took a pay cut from teaching when I became an attorney.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.