I worked in debt collections a couple of years ago. A big company, I worked on some of the big student loan accounts. I can't tell you the whole picture from that, because by the time we got an account it was in outside collections. That's a later stage of the being behind in payments cycle. But I can tell you there are a LOT of young kids just a few years out of college in collections. And way too many get garnisheed. They literally live on a few hundred dollars above the table a month, after the garnishment. You try that.
USAToday article from 2006:
Nearly half of twentysomethings have stopped paying a debt, forcing lenders to "charge off" the debt and sell it to a collection agency, or had cars repossessed or sought bankruptcy protection.I suspect that you are wrong, WAY wrong when you say that "Most students have used good judgment when taking out student loans and most pay back what they owe." I know a lot of kids in there twentysomethings, and that is NOT the case.
NONE of them understood fully, or close to fully the weight of the loans they were taking on. Just as your model of the actual condition is, imo, way off and even delusional because of abject ignorance -- not knowing what you do not know -- so too was theirs when they signed up for the loans.
Most of the ones I know are making a good faith and earnest effort to repay the loans. But I already know that in a few years a significant number will have encountered some economic upset -- sickness, injury, loss of job -- that they will not be able to recover an honest hope of paying back what are for some ridiculously high debt burdens for the field they are in.
It's just the kind of thing my very old school Scottish Bank Examiner, and trainer of examiners, left the trade because of. That the lenders had abandoned any semblance of due diligence in making loans. He died seven years ago in his late nineties, he had worked long into his seventies.
Old school bank loans were HARD to get. But that difficulty meant nearly all were repaid, and the borrowers and the bank both were enriched and happy. He'd NEVER had lent 50,000 to train a woman to be a Kindergarten teacher, or such similar follies of modern 'higher ed'.
I repeat that most of the borrowers are making their required student loan payments but, just like a minority of homeowners, there are some who have knowlingly borrowed way too much for an education that is of little real value. In that case, you work two fulltime jobs if necessary and live at the parents home, if possible, to pay down the debt so that it is manageable to the point you can leave one of the fulltime jobs. These excuses as to who is responsible does not pay the bills.
So, we agree to disagree. The University Industrial Complex is a big ripoff these days for many, that I agree.
>>And way too many get garnisheed. They literally live on a few hundred dollars above the table a month, after the garnishment. You try that.<<
I see what is going on here. Sort of a combination of Survivor’s Guilt and kind of a reverse Stockholm Syndrome.