Student Loan changes
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Not sure if this is good or not.
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Not good. It still absolutely ignores the glaring problems in the system. I actually ran the numbers on Lucas’ 2 loans. If he followed Sallie Mae’s suggested repayment plan, his $6000 loan per year will cost him over $24K by the time he pays it off. The issue is that they don’t make that clear and actually obfuscate those details to the student. And again, continually try to get the students to borrow more. The college loan business is nearly as predatory as payday loans. Worse, IMO.
It also does not force lenders to assume risk. It doesn’t force them to be more careful and cautious creditors. It also does not force the schools themselves to be more careful custodians of their own finances and to improve the fiscal management of their institutions.
Without addressing these issues, things will continue to get worse.
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Not good. It still absolutely ignores the glaring problems in the system. I actually ran the numbers on Lucas’ 2 loans. If he followed Sallie Mae’s suggested repayment plan, his $6000 loan per year will cost him over $24K by the time he pays it off. The issue is that they don’t make that clear and actually obfuscate those details to the student. And again, continually try to get the students to borrow more. The college loan business is nearly as predatory as payday loans. Worse, IMO.
It also does not force lenders to assume risk. It doesn’t force them to be more careful and cautious creditors. It also does not force the schools themselves to be more careful custodians of their own finances and to improve the fiscal management of their institutions.
Without addressing these issues, things will continue to get worse.
@LuFins-Dad said in Student Loan changes:
Not good. It still absolutely ignores the glaring problems in the system. I actually ran the numbers on Lucas’ 2 loans. If he followed Sallie Mae’s suggested repayment plan, his $6000 loan per year will cost him over $24K by the time he pays it off. The issue is that they don’t make that clear and actually obfuscate those details to the student. And again, continually try to get the students to borrow more. The college loan business is nearly as predatory as payday loans. Worse, IMO.
It also does not force lenders to assume risk. It doesn’t force them to be more careful and cautious creditors. It also does not force the schools themselves to be more careful custodians of their own finances and to improve the fiscal management of their institutions.
Without addressing these issues, things will continue to get worse.
I think we're back to Jon's proposal - get the Feds out of the loan business.
