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> The only reason I was able to pay my loans was because the Army paid them for me after I completed my term of service. I tried for years to find employment th

> The only reason I was able to pay my loans was because the Army paid them for me after I completed my term of service. I tried for years to find employment that could help me escape a life of poverty but could not. Okay, so then I must ask: What did you major in, what was your total debt, and did you research the career prospects of your major BEFORE going to college? Sometimes I think a basic mandatory form that came with your college acceptance letter would do wonders for student debt. You have chosen to apply to be a history major at private school X. Our graduation rate for the program is 95%. Your total student debt upon graduation will be approximately $145,000. That is a monthly payment of $2000. Our 25th, 50th, and 75th percentile wages for graduates with this degree are $20,000, $25,000, and $30,000. This means you can expect to pay about 107% of your income towards servicing your loan for the first 10 years after graduation.

Kluny 10y ago
That would be a great idea. Universities won't do this unless they're legally required to. Student ignorance drives their business model.
- brianwawok 10y ago
  Of course, but I had to sign stuff like this to get a mortgage. A bunch of mandated forms about worst case payments. Seems an easy law to help reform loans.
  - Kluny 10y ago
    It's easy and it should be done, but I don't think it will be that effective. Mortgages come with other rules. If you can't come up with 20% down, you pay mortgage insurance. If you have limited ability to pay it off, you don't qualify for as much cash. If you have a bad credit history, you pay higher interest. All these things are meant to keep mortgage debt from getting out of control. No such rules exist for student loans.
- eli_gottlieb 10y ago
  They're universities. They don't have a business model. They're not businesses. Their job is to teach and to research, not to make a profit.
  - scarface74 10y ago
    That's not true. There are a lot of private universities and so called "non profit" universities where a lot of people are making money. Even public universities will do what it takes to stay open - including denying state residents admissions in favor of foreigners who pay full price.
    - eli_gottlieb 10y ago
      Yes, state funding cuts have severely messed-up universities' ability to act according to their chartered purpose. That doesn't mean the charter isn't there.
Retric 10y ago
The trap is far less obvious. 150K $ 4% = 500$ per month which seems doable. But, many things can also snowball. First intrest rates can rise, second unemployment can rapidly increase loan amounts when either the student after graduation or the parents during collage. Loans are often 50+% higher than initially expected for a huge range of reasons.
- brianwawok 10y ago
  Interest rates can be fixed. Some are some are not. If not fixed, they often have a ceiling, and you can propose a guide. In no case will it be bulletproof against things like unemployment. That is OK. We haven't had a recession in years. People in the last 4 years with student loan debt problems? Not due to a sudden economy shift.
- nhangen 10y ago
  $500/month is a ton of money when it's competing against groceries, utilities, healthcare, etc.
x0x0 10y ago
Yes, it's a good idea to take eighteen year olds (that have been told their whole lives that they should go to college) and push them make decisions whose negative consequences we never allow them to escape.
- brianwawok 10y ago
  They do that every day on their own. They decide to smoke or not. Many choose to drink and drive. By 18 you easily have the power to ruin your life, or those of others. At 16 even, not the uncommon to see a 16 year old in the news for running over someone. I propose we give them more information. Perhaps not the end all be all, but at least give them a hope to make a smart decision.
  - x0x0 10y ago
    Just make the loans dischargeable in bankruptcy and the problem will sort itself. ps -- none of your supposed similar items are widely endorsed by teachers/society/parents.
    - dragonwriter 10y ago
      They are dischargeable in bankruptcy, but the requirements for discharging them are more difficult to meet than those for other unsecured debt.
      - x0x0 10y ago
        No, they're functionally impossible to discharge in bankruptcy.
        dragonwriter 10y ago
        http://abovethelaw.com/2016/01/the-tetzlaff-aftermath-discharging-student-loans-in-bankruptcy-might-be-easier-than-we-thought/ http://abovethelaw.com/2016/01/the-tetzlaff-aftermath-discha...
nhangen 10y ago
I got a B.S. in Psychology and a minor in religion. Total debt around 25-30k. I went to school at age 20 and graduated at age 25. I did not go straight from High School. I did not want to be a shrink. I wanted to focus on research. Unfortunately, I could not afford to continue on to graduate school. My grades weren't good enough to get a scholarship. I was working as a cook at the Olive Garden, and had kids at home, so I tried a few careers that didn't work out. I wound up in the Army because it seemed like the right thing to do. I'm glad I did it.
dikdik 10y ago
And what happens when you switch majors? All of your scholarship money gets revoked? Most schools do not require you to declare a major when applying or during the freshman year. Most people that have a major in mind when entering college end up changing it as well. I think this is telling that MOST people do not go to college because they are super passionate about whatever subject. Most people go to college because they would like to find a job that will ensure them middle class wages. If we fixed the job market (ie prevent jobs from requiring a bachelors or masters when many high school graduates could be trained to do it AND increase wages not just at the top of the spectrum), I have a strong suspicion there wouldn't be so many people going to college for "bullshit" degrees and even if there were they would actually be able to pay their loans back in a timely manner.
- brianwawok 10y ago
  And what happens when you switch majors? All of your scholarship money gets revoked? Honestly, switching majors if a bit of a failure of the system. Ideally we would expose students to more parts of a major in High School, so they can make better decisions. Most high schools do not do a great job of this in the US. Most schools do not require you to declare a major when applying or during the freshman year. Most people that have a major in mind when entering college end up changing it as well. (Citation required for both of these). I have found it a mix on what schools require. Back when I applied to colleges (2000?), most colleges DID have me pick a major. A few pushed off till Sophomore year, but not most by any means. And MOST people did not switch majors when I was in school. Some did, and some dropped out, but hardly most. I think this is telling that MOST people do not go to college because they are super passionate about whatever subject. Most people go to college because they would like to find a job that will ensure them middle class wages. Great. So why do people major in History and "Business" and "Women's Studies"? None of these majors lead to a middle class job. If you want a middle class job, there are many majors almost guaranteed to get you there (i.e. education, nursing, programming.. all a big demand for people, all pay some form of middle class white collar wage). If we fixed the job market (ie prevent jobs from requiring a bachelors or masters when many high school graduates could be trained to do it AND increase wages not just at the top of the spectrum), I have a strong suspicion there wouldn't be so many people going to college for "bullshit" degrees and even if there were they would actually be able to pay their loans back in a timely manner. What? As an owner of a business, you would tell me I cannot require college degrees from my new hires? Fine, I will remove it from my job posting. During interviews I will ask what college the person went to. If I don't like the answer, I will send them home. You are NEVER going to legislate anything like this away. Businesses hiring want the best candidates. If they feel college students are better, then they will pick them. This would be perhaps the worst regulation you could possibly put on small businesses.

Kluny 10y ago

That would be a great idea. Universities won't do this unless they're legally required to. Student ignorance drives their business model.

brianwawok 10y ago
Of course, but I had to sign stuff like this to get a mortgage. A bunch of mandated forms about worst case payments. Seems an easy law to help reform loans.
- Kluny 10y ago
  It's easy and it should be done, but I don't think it will be that effective. Mortgages come with other rules. If you can't come up with 20% down, you pay mortgage insurance. If you have limited ability to pay it off, you don't qualify for as much cash. If you have a bad credit history, you pay higher interest. All these things are meant to keep mortgage debt from getting out of control. No such rules exist for student loans.
eli_gottlieb 10y ago
They're universities. They don't have a business model. They're not businesses. Their job is to teach and to research, not to make a profit.
- scarface74 10y ago
  That's not true. There are a lot of private universities and so called "non profit" universities where a lot of people are making money. Even public universities will do what it takes to stay open - including denying state residents admissions in favor of foreigners who pay full price.
  - eli_gottlieb 10y ago
    Yes, state funding cuts have severely messed-up universities' ability to act according to their chartered purpose. That doesn't mean the charter isn't there.

Retric 10y ago

The trap is far less obvious. 150K $ 4% = 500$ per month which seems doable. But, many things can also snowball. First intrest rates can rise, second unemployment can rapidly increase loan amounts when either the student after graduation or the parents during collage. Loans are often 50+% higher than initially expected for a huge range of reasons.

brianwawok 10y ago
Interest rates can be fixed. Some are some are not. If not fixed, they often have a ceiling, and you can propose a guide. In no case will it be bulletproof against things like unemployment. That is OK. We haven't had a recession in years. People in the last 4 years with student loan debt problems? Not due to a sudden economy shift.
nhangen 10y ago
$500/month is a ton of money when it's competing against groceries, utilities, healthcare, etc.

x0x0 10y ago

Yes, it's a good idea to take eighteen year olds (that have been told their whole lives that they should go to college) and push them make decisions whose negative consequences we never allow them to escape.

brianwawok 10y ago
They do that every day on their own. They decide to smoke or not. Many choose to drink and drive. By 18 you easily have the power to ruin your life, or those of others. At 16 even, not the uncommon to see a 16 year old in the news for running over someone. I propose we give them more information. Perhaps not the end all be all, but at least give them a hope to make a smart decision.
- x0x0 10y ago
  Just make the loans dischargeable in bankruptcy and the problem will sort itself. ps -- none of your supposed similar items are widely endorsed by teachers/society/parents.
  - dragonwriter 10y ago
    They are dischargeable in bankruptcy, but the requirements for discharging them are more difficult to meet than those for other unsecured debt.
    - x0x0 10y ago
      No, they're functionally impossible to discharge in bankruptcy.
      - dragonwriter 10y ago
        http://abovethelaw.com/2016/01/the-tetzlaff-aftermath-discharging-student-loans-in-bankruptcy-might-be-easier-than-we-thought/ http://abovethelaw.com/2016/01/the-tetzlaff-aftermath-discha...

nhangen 10y ago

I got a B.S. in Psychology and a minor in religion. Total debt around 25-30k. I went to school at age 20 and graduated at age 25. I did not go straight from High School. I did not want to be a shrink. I wanted to focus on research. Unfortunately, I could not afford to continue on to graduate school. My grades weren't good enough to get a scholarship. I was working as a cook at the Olive Garden, and had kids at home, so I tried a few careers that didn't work out. I wound up in the Army because it seemed like the right thing to do. I'm glad I did it.

dikdik 10y ago

And what happens when you switch majors? All of your scholarship money gets revoked? Most schools do not require you to declare a major when applying or during the freshman year. Most people that have a major in mind when entering college end up changing it as well. I think this is telling that MOST people do not go to college because they are super passionate about whatever subject. Most people go to college because they would like to find a job that will ensure them middle class wages. If we fixed the job market (ie prevent jobs from requiring a bachelors or masters when many high school graduates could be trained to do it AND increase wages not just at the top of the spectrum), I have a strong suspicion there wouldn't be so many people going to college for "bullshit" degrees and even if there were they would actually be able to pay their loans back in a timely manner.

brianwawok 10y ago
And what happens when you switch majors? All of your scholarship money gets revoked? Honestly, switching majors if a bit of a failure of the system. Ideally we would expose students to more parts of a major in High School, so they can make better decisions. Most high schools do not do a great job of this in the US. Most schools do not require you to declare a major when applying or during the freshman year. Most people that have a major in mind when entering college end up changing it as well. (Citation required for both of these). I have found it a mix on what schools require. Back when I applied to colleges (2000?), most colleges DID have me pick a major. A few pushed off till Sophomore year, but not most by any means. And MOST people did not switch majors when I was in school. Some did, and some dropped out, but hardly most. I think this is telling that MOST people do not go to college because they are super passionate about whatever subject. Most people go to college because they would like to find a job that will ensure them middle class wages. Great. So why do people major in History and "Business" and "Women's Studies"? None of these majors lead to a middle class job. If you want a middle class job, there are many majors almost guaranteed to get you there (i.e. education, nursing, programming.. all a big demand for people, all pay some form of middle class white collar wage). If we fixed the job market (ie prevent jobs from requiring a bachelors or masters when many high school graduates could be trained to do it AND increase wages not just at the top of the spectrum), I have a strong suspicion there wouldn't be so many people going to college for "bullshit" degrees and even if there were they would actually be able to pay their loans back in a timely manner. What? As an owner of a business, you would tell me I cannot require college degrees from my new hires? Fine, I will remove it from my job posting. During interviews I will ask what college the person went to. If I don't like the answer, I will send them home. You are NEVER going to legislate anything like this away. Businesses hiring want the best candidates. If they feel college students are better, then they will pick them. This would be perhaps the worst regulation you could possibly put on small businesses.