Posted on 08/02/2019 10:57:45 AM PDT by Brian Griffin
1. Limit new federal student loans to:
a. $15,000/first, second, third, fourth year - college education on a state/regionally/nationally accredited engineering track or domestic licensing/certification law teacher/nursing/physician assistant track,
b. $8,000/first year - general college education,
c. $10,000/second, third, fourth year - general college education,
d. $5,000/additional year, but to no more than $40,000 for any student in total student loan indebtedness - undergraduate college education [students taking more than four years to graduate]
e. $12,000/additional year - general college education, four-year college degree already earned by the student,
f. $25,000/first/second/third year - bar acceptable, state/regionally/nationally accredited law school education,
g. $40,000/year - domestic licensing law acceptable, state/regionally/nationally accredited dentist/medical doctor education.
2. The yearly limits of shall be adjusted for inflation as are federal income tax rate thresholds.
3. Reduce the yearly limits by the higher of:
a. 20%, if the college has in the prior academic year frequently been unable to timely provide its students with courses needed to graduate in the normal timeframe to earn a degree,
b. the percentage of federal loans previously granted to the college that were in default/deferment, as determined by the federal Department of Education, at a time within the past year.
4. Semester loan limits shall be half of the yearly limits.
5. Term loan limits shall be the yearly limits divided by the usual number of terms per academic year.
6. Require colleges, and their holding companies, to co-sign associated new student loans, if federal or if federal bankruptcy student loan exemption is to be applied.
7. Limit future federal loan originations for attendance at any educational institution to the value of real property (and half that of third party publicly traded securities) fully secured to the federal Department of Education as collateral.
8. Allow new private student loans signed or co-signed by a person at the time of issue related to the student by blood, adoption or guardianship to be subject to federal bankruptcy discharge ten years or more after issue, excluding deferment periods, less:
a. one month per 1/10th interest rate percentage above four,
b. one month per 1/100th of the net loaned amount in debt add-ons, such as points, fees and charges.
Average student loan debt total per person: $31,172
Average monthly student loan payment for graduates: $393
The number of debtors owing more than $75,000 is less than 10 percent.
My student loan debt in 1982 would be about $310 in 2019 dollars. Of course I majored in a marketable degree.
“I should also mention that not all of them will file bankruptcy.”
LOL! Bankruptcy would become a resume enhancer!
Do you a reference for those average debt numbers? Those are interesting numbers.....
Just make the debt dischargeable in bankruptcy, maybe with the additional caveat that universities have to approve all borrowers because the will banks have recourse to recover some percentage of their loss from university endowments.
Whole "Anti-American Studies" departments will blow away in the wind, as universities realize they will be on the hook for the future failures they are creating.
Honestly there’s only one reform needed: stop making them federally guaranteed. Turn them into normal loans where the students can be rejected, but also can clear via bankruptcy.
LOL! Bankruptcy would become a resume enhancer!
She said it would lose its stigma. And I’ll add - just lke the housing crisis removed the stigma from walking away from a home loan.
“You are limiting commerce”
I’m proposing limiting federal loan amounts.
I’m also proposing college co-signing, when a federal loan is involved or the lender wishes to bar federal bankruptcy on the loan:
“6. Require colleges, and their holding companies, to co-sign associated new student loans, if federal or if federal bankruptcy student loan exemption is to be applied.”
Private loan amounts are obviously possible under my proposal(including ones where only the student signs the loan):
“8. Allow new private student loans signed or co-signed by a person at the time of issue related to the student by blood, adoption or guardianship to be subject to federal bankruptcy discharge ten years or more after issue, excluding deferment periods, less:
a. one month per 1/10th interest rate percentage above four,
b. one month per 1/100th of the net loaned amount in debt add-ons, such as points, fees and charges.”
Number 8 is to protect parents.
Federal bankruptcy law is authorized by our federal Constitution.
By the way, I took out a private loan ($1,500) as well when I went to college.
The average community college tuition is around $5,000/year.
If you start there, you can transfer your credits to a four-year college as a junior. That way, you save money the first 2 years.
Well you can read it all at the library. Doesn’t mean you can do it. I’m all for self taught but there are certain things you get in a school you can’t get from books. Most importantly somebody to look at what you wrote down and say “you forgot to carry the 3”.
‘Everyone seems to be afraid to say, ‘let the market work.’”
My proposal is one that takes small steps.
No one should be borrowing money for college.
You can start at a community college for two years, and then transfer into a university as a junior/commuter student.
Only start as a freshman at a university and live on campus all 4 years (1) if you receive a full scholarship, or (2) if you or your parents have the cash to pay the whole way.
Well, when it comes to FEDERAL student loans, let’s keep it simple: get rid of them entirely. Not the government’s business. Period.
That is reasonable.
“So we’d be back to only the rich going to college? Brilliant!!”
Top colleges graduate many students that make big money, some of whom show their gratitude to their college’s endowment fund.
Enormous endowment funds can be put to more vigorous work than overpriced common stocks: investing in future generous alumni.
“Well, when it comes to FEDERAL student loans, let’s keep it simple: get rid of them entirely. Not the government’s business. Period.”
I got National Defense Student Loans myself - period.
I worked on something called the Internet starting in 1981.
My work was primarily intended for military command & control purposes.
“You can start at a community college for two years, and then transfer into a university as a junior/commuter student.”
My university had very strict rules about credit transfers for monetary influx maintenance.
I like it.
That was almost 100 years ago, my man.
Sorry, I used the word “you” in a general sense. By “you,” I meant any college student today.
Today most universities accept transfer credits from community colleges.
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