Posted on 06/11/2012 12:25:20 PM PDT by TurboZamboni
IOW, why would it be good to make student loan debt dischargeable in bankruptcy like most other consumer debt?
(Excerpt) Read more at freerepublic.com ...
Spring break trips, the “in” style jeans, etc. I am sure it varies a great deal, but yes, I expect a good percentage of the “student loans” finance the lifestyle, not the education.
Do we really need more earth sciences or social justice majors?
Student debt is money given on the promise of future earnings, based on the value of the education received. I could only see it as dischargeable if the person were disbarred from ever working in the field they studied.
Otherwise, student loans would become pell grants for the unscrupulous.
Perhaps a minimum waiting period (say 8 years) before they became dischargeable would be a compromise.
It used to be getting pregnant before marriage was shameful as was sitting on welfare for years,too.
Maybe rather than to continue to play the game, feed the beast and incur more pointless debt, the yutes should find alternative ways of learning a marketable skill? (And yes, maybe I'm old fashioned and naive.)
IIRC, I think 0bama has recently proposed that all student loan debt be written off after 20 years or something like that.
in 1998 Congress changed the law so that government backed student loan could not be discharged at all and in 2005 this was extended to private student loans.
I would make a point to never hire anyone who had their student loans discharged.
Who knows what job they’ll get. A lot of companies that want employees with degrees don’t care what the actual degree is in, they want the proof that you can complete a long term task with no immediate or intermediate rewards.
A lot of student loans were bad loans to start.
Take away the greater powers to recover and they’re horrendous loans: people would simply go through bankruptcy instead of paying them off, then wait a few years before buying houses and going ahead with life as if nothing happened.
Wasn’t there some level of government paying off those loans? That would be 11 years minimum between the first loan and bankruptcy, so it’s a pretty good bet they ain’t paying ever. That could be reasonable, but of course then you have the government paying off the guarantee of the biggest deadbeats.
A lot of companies won’t hire folks that have bankruptcies ping in their record at all. They don’t like the lack of responsibility it shows.
And employers do care about how people finance their education, just financing it through loans without working to pay for at least part of it is a black mark.
IMO, making student loans completely non-dischargeeable (except in case of undue hardship, which is almost never the case) has only enticed a lot of "schools" to push loans to students, resulting in much higher participation rates, and much higher tuition.
Knew of a Bankruptcy lawyer who paid off all his and his wife’s student debt with American Express and other cards then declared BK.
“What is the purpose of bankruptcy if the most disruptive loans in a person’s life (student loans) cannot be discharged in bankruptcy?”
So you believe that I should pay for your poor life decisions?
I personally think that student loans unsecured by real property should be illegal, primarily for the reasons mentioned above, primarily abuse of the system. I also think that if they are legal, it should be illegal for any government entity to be involved.
Sorry. You play, you pay. Anything else is Obamanomics.
Obama orders changes to student loan payments
Oct 25, 2011
The Administration is moving forward with a new “Pay As You Earn” proposal that will reduce monthly payments for more than one and a half million current college students and borrowers. Starting in 2014, borrowers will be able to reduce their monthly student loan payments to 10 percent of their discretionary income. But President Obama realizes that many students need relief sooner than that. The new “Pay As You Earn” proposal will allow about 1.6 million students the ability to cap their loan payments at 10 percent starting next year, and the plan will forgive the balance of their debt after 20 years of payments. Additionally, starting this January an estimated 6 million students and recent college graduates will be able to consolidate their loans and reduce their interest rates. ...
Obama Breaks Down Student Loan Overhaul
He will also talk about the provision’s less controversial expansion of Pell Grants, as well as supporting historically black and minority institutions and caps on student loan repayments.
According to the White House, “New borrowers who assume loans after July 1, 2014, will be able to cap their student loan repayments at 10 percent of their discretionary income and, if they keep up with their payments over time, will have the balance forgiven after 20 years.”
http://whitehouse.blogs.foxnews.com/2010/03/30/obama-breaks-down-student-loan-overhaul/
So basically, you need to make sure you buy or rent a living space expensive enough to maximize your non-discretionary spending, so you make the absolute minimum student loan payments for 20 years. Then the debt disappears!
Or more acurately, your debt gets paid by other Americans, which is “free money”!
Those of us who pay off our loans and debts sure look like chumps.
“These investments complement President Obama’s broader agenda for higher education and will help us reach his goal of America having the highest proportion of college graduates in the world by 2020.”
http://www.whitehouse.gov/sites/default/files/10326-higher-ed.pdf
(no mention given to QUALITY)
“Public service workers such as teachers, nurses, and those in military service will see any remaining debt forgiven after just 10 years.”
“So they should get a free ride. Personal responsibility be damned. Sorry. You play, you pay. Anything else is Obamanomics.”
Bankruptcy laws are there for exactly this reason. These kids that are candidates for bankruptcy are never going to pay it back. They will never be able to - through their own sheer stupidity. That it was allowed to happen with government encouragement is a travesty.
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