Posted on 10/02/2023 12:34:51 PM PDT by grundle
As federal student loan payments restart in October, CNN spoke to a lawyer, a doctor, and a scientist about their debt, and how it’s impacted their lives.
(Excerpt) Read more at yahoo.com ...
To let 34K balloon into 500K requires a PHD level of stupid.
Anyone with a government backed student loan for 20 years got their canceled last month.
So, this story might just be BS.
Here are the historic interest rates on student loans:
https://www.savingforcollege.com/article/historical-federal-student-interest-rates-and-fees
They were in the 7 to 8% range in the 1990s....
The numbers could be legit.
Ignore the headlines and read the fine print:
https://www.nerdwallet.com/article/loans/student-loans/idr-adjustment-forgiveness
The “cancellations” have enough loopholes that these folks easily could still be on the hook....
Don’t they all.
You can graduate at age 22 with $34K in loans at 6% APR, not pay anything on them, and when you are 68 you will owe $500K.
Exactly.
Even with a 10% loan you’d be close to 55YO before it went from $34K to $500K
if she never made a single payment and had some ungodly bad interest rate (10% or so) after about 30 years the compounding would ballon the debt to about that much.
I noticed that whenever I pay certain bills, they just send me another one the next month.
It’s sort of like a program: Send bill, receive payment, send bill, and so on.
So I can foil the system by putting the program in a wait-state simply by not paying!
One missing piece to the puzzle are late fees:
https://www.nerdwallet.com/article/loans/student-loans/ask-brianna-missed-student-loan-payment
“After 30 days. Your servicer can begin charging you up to 6% of your missed payment amount as a late fee. For example, every time you skip a $300 payment, you could be hit with an $18 fee.”
If those late fees accrue interest it could get “interesting” in a hurry.
how did people this stupid get degrees?
Maybe she shouldn’t have borrowed from loan sharks and skipped the payments
“The “cancellations” have enough loopholes that these folks easily could still be on the hook....”
Government loan, 20 (Bach) or 25 (grad) years, current on payments (no payment were during covid), and that’s about it.
You can defer them after you graduate. I did this for a few years.
That’s all colleges give out nowadays.
“how did people this stupid get degrees?”
Come on, you know the answer to that. There are no standards of admission or graduation in college. Simply apply then attend, turn in something at homework time, write you name on tests, and you’ll get at least a D- and a diploma.
The “current on payments” (not including Covid) is the big loophole.
Many of these “financial geniuses” out there never got current—ever.
From : https://studentaid.gov/understand-aid/types/loans/interest-rates
Direct Subsidized Loans and Direct Unsubsidized Loans Undergraduate
5.50%
Direct Unsubsidized Loans
Graduate or Professional
7.05%
Direct PLUS Loans
Parents and Graduate or Professional Students
8.05%
She would have to have not paid squat like ever. Thats really stupid.
Fetch me my clutching pearls and lead me to my fainting couch...
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