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Oddly, having interest rates increase would be a net positive. The whole issue with student loans is that banks have no skin in the game. They literally cannot
by MR4D 7y ago
Oddly, having interest rates increase would be a net positive. The whole issue with student loans is that banks have no skin in the game. They literally cannot lose money on a loan, so they will give them to anybody for any amount.
The whole problem with student loans is that there is no risk in making a student loan. Solve that issue, and the problem will correct itself.
FYIW, the cleanup process is going to be ugly - hangovers always are, and all remedies will suck to some degree or another. [1]
[1] - A quick googling led to this article: https://fee.org/articles/how-government-guaranteed-student-loans-killed-the-american-dream-for-millions/ https://fee.org/articles/how-government-guaranteed-student-l...
- Sohcahtoa82 7y agoIf banks have to become selective on who they give student loans to, then the lower class, who probably needs them the most to be able to improve themselves, won't be approved.
- MR4D 7y agoIf they can give them credit cards and auto loans, then they can also give them school loans. Right now the situation is worse - people are working low wage jobs (such as waiters) after incurring tens of thousands in debt. Wouldn’t being a waiter without the debt be a much better situation? People need to be better with their money. Way too many people in the middle class blow their money on things like fancy cars and then borrow for college degrees that have little value, or can never realistically be paid back. Yes, some people will be hurt, but right now we are screwing up an entire generation, and the data shows it plainly.