Free Republic

Bernie Sanders, Elizabeth Warren, and numbers of the rest of the Democratic field claim it should happen. Of course none of them have advanced legislation to do so, and their official platforms don’t explain how they would. Recent administrations ran on reforming the system but once elected neither Democrats nor Republicans appear to have remembered their promise to do so. This includes the current former Vice President who now wants his former boss’ job even though he seems to barely be able to remember what he had for breakfast. (Oops that’s right he didn’t have breakfast.) Everyday from the Decision...

As a Millennial with student loans, the idea of a magic eraser wiping my Sallie Mae account clean sounds really good – actually too good. And when things sound too good to be true, they usually are.When politicians say, they want to “erase,” “cancel,” or “forgive” student loan debt, what they are really talking about is redistributing personal debt. They want to transfer the balance from individual student loan accounts to an account that all Americans are on the hook for, including the over 120 million without a degree.Blue-collar workers who entered the workforce straight after high school and didn’t...

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,...

With the growth in student loans continuing to soar, politicians and borrowers struggling with an issue that’s become both a financial and political problem. Presidential candidates are proposing to cancel student debt and make public college free, state legislators are cracking down on student-loan companies and, recently, government agencies have offered another approach — teaching students and borrowers more about finances. The Treasury Department recommended earlier this month that colleges should require students to take financial-literacy courses and representatives from the Department of Education told a group of financial-aid professionals this week that the agency is planning to add robust...

I have $235,000 of student debt. The first $120,000 came with a bachelor’s degree from my state school. Another $70,000 or so came with my master’s degree. The remainder is accrued interest. I would have to begin devoting half of my income to debt payment if I cared to pay it off by 2042. I can’t do that because I make just under $4,000 per month. And that income is a fairly new development in my life. Why would I choose to pay down my debt if it meant I wouldn’t be able to afford basic living expenses? My parents...

NEW YORK (AP) — The government’s top official overseeing the $1.5 trillion student loan market resigned in protest on Monday, citing what he says is the White House’s open hostility toward protecting the nation’s millions of student loan borrowers. Seth Frotman will be stepping down as student loan ombudsman at the end of the week, according to his resignation letter, which was obtained by The Associated Press. He held that position since 2016, but has been with Consumer Financial Protection Bureau since its inception in 2011. Frotman is the latest high-level departure from the CFPB since Mick Mulvaney, President Donald...

There is a college affordability crisis. My university charges over ten times as much for tuition as when I first went there in September 1975. I know many academics and loan originators will provide vehement arguments why their feed bowls should't get rationed, but unless college loans are restrained to reasonable amounts there will be Democratic demands for "free" college education that will eventually cost many of us and most future college graduates dearly. BANKRUPCY BAR For loans issued after July 1, 2018, only the principal amount(s) borrowed a. from the federal Department of Education (DoE) b. to refinance, with...

Billions of dollars in student loans may be wiped out for tens of thousands of borrowers in the US because a lender didn't keep track of the paperwork verifying ownership of the loans, according to The New York Times. The National Collegiate Student Loan Trusts, which holds 800,000 private loans and is one of the country's largest owners of private student loans, is at the center of the legal dispute, the Times reported. Borrowers are failing to repay more than $5 billion of the $12 billion in private student loans held by National Collegiate, sending the loans into default. The...

The rising burden of student debt is weighing on interest rates in the U.S., and it would be a “reasonable conversation” for policy makers to explore making college tuition free, Federal Reserve Bank of New York President William Dudley said. The growing pile of student debt is “obviously one headwind to economic activity” that “probably pushes in that direction of lower equilibrium real rates” because it limits households’ spending power, Dudley said Monday during a press briefing in New York.

For years we've heard a lot about the terrible plight of those unfortunate college students who've been saddled with student loan debt. And, at least from Democrats, we've heard urgent calls for "debt relief." What we haven't heard about, until now, is what exactly students are using their college loan money for. Now we know, thanks to a survey by LendEDU, a student loan news website. In a nationwide survey, LendEDU asked students whether they were planning to use any loan money to help pay for travel or lodging for Spring Break. What they found was that nearly 31% said...

Student Loans: When President Obama came into the White House eight years ago, he promised a "New Era of Responsibility." It didn't work out that way, particularly for student loans, leaving President Trump with a huge mess to clean up. In fact, when it comes to borrowing for college, students are being utterly irresponsible. A recent survey by LendEDU of 500 current college students found that 49.8% of them think that the federal government will forgive their loans after they graduate. "In reality," LendEDU's Mike Brown notes, "a very small percentage of graduates will even qualify for Public Service Loan...

Most student loans in the United States are guaranteed by the federal government. The main difference between private loans and the guaranteed loans is that the former usually come with a higher interest rate: Students generally don't seek these out until they cannot access guaranteed loans any longer. However, neither type can normally be discharged via bankruptcy. The problem with government-backed loans is that the guarantee creates a moral hazard of the same sort that bedeviled mortgage markets before and during the Great Recession. A college can treat a guaranteed student loan as a sure thing with no attendant obligations:...

A new study from the prestigious and scrupulously non-political National Bureau of Economic Research (which designates the beginning and end of recessions) blames student loan subsidies for nearly all of the tuition increases that have caused college education to become so expensive as to financially cripple families and indebted students.  Professor Alex Tabarrock explains the highly technical paper at the Foundation for Economic Education: Grey Gordon and Aaron Hedlund create a sophisticated model of the college market and find that a large fraction of the increase in tuition can be explained by increases in subsidies. (snip) Remarkably, so much...

Each of the Democratic presidential candidates has come out in favor of some version of a plan to make college "free." This staggeringly bad idea would cost a half-trillion dollars per year. Things that seem to "cost nothing" can often wind up being worth nothing. College is no different. Students need to have some "skin in the game." They will make more considered choices-about where they go to school, how much debt they take on, how hard they party, and how diligent they are in their studies-if they're paying something. That's not to say that growing student debt isn't a...

Millennials. Some think weÂ’re lazy, others think our unorthodox career paths are how we game the system. Among our biggest pet peeves are a lack of upward mobility and a rigid, one-size-fits-all prescription for finding success. The worst? When established keepers of the status quo try to force the future they think is best, with little opportunity to escape the allegedly good intentions of an overzealous government. Just what has our expansive government done for young Americans, and what will it do to us as we get older? Forty million of us pursued higher education and are on the hook...

On Monday, we got some color on Hillary Clinton’s $350 billion plan to make college more affordable. Students and former students across the country owe more than $1.2 trillion in college loans, and as Bill Ackman so eloquently put it earlier this year, "there’s no way they’re going to pay it back." The fact that America’s student loan bubble is the focus of what may well end up being one of Clinton’s most expensive policy proposals speaks volumes about the urgency of the problem. Of course there are some other folks who understand how quickly the situation is deteriorating. Chief...

There are some valid points raised in Lee Siegel's 1100 word rant against college loans (if not so much against college education). There are some bad ones. But two things are clear: the words "personal" and/or "responsibility" were used precisely zero times, and the op-ed writer, who described himself as "the author of five books who is writing a memoir about money", is hardly a glowing advertisement for an education attained (funded with either debt or equity) at one of the Ivy League's "best", Columbia University.That, or the return on money after spending nearly a decade in university and...

On April 15 Tax Day, Americans paid about the same amount of income tax as total student loans outstanding. The St. Louis Federal Reserve on the same day published a report titled ‘Student Loan Delinquency: A Big Problem Getting Worse?' The Fed has determined that of the $1.3 trillion in non-bankruptcy-dischargeable student loans, the delinquency rate for students in repayment is over 27 percent. With tuition at the University of California and other top schools growing faster than inflation, student loan defaults are skyrocketing. Prior published student loan reports have stated that the “30+ days delinquency rate for all student...

rresponsibility: A new report finds that 27.3% of student loans are delinquent. Why does this matter? Because thanks to President Obama, about $1 trillion dollars of student loan debt is owed to the federal government. Obama keeps trying to portray the student loan crisis as a problem suffered by students burdened by a mountain of debt when they graduate, and who are unable to make enough money to pay it back. But that's not the real crisis. First, average student loan debt is only a little over $20,000. A student who gave up his $5-a-day Starbucks habit could pay off...

How did the federal student loan program rack up such massive debt so quickly? Let's take a look at Obama's recent reform efforts and programs to help provide relief to student borrowers. A few days ago, Politico revealed a little gem hidden in the Obama budget: “In obscure data tables buried deep in its 2016 budget proposal, the Obama administration revealed this week that its student loan program had a $21.8 billion shortfall last year, apparently the largest ever recorded for any government credit program.” That’s a nearly $22 billion loss—for one program, for one year. Politico described how that...