4 ms·

> She tried to insist that my offer to point her in the direction of gig work was unhelpful as she had some minimum income requirements to pay her student loans

by Iv 6y ago

> She tried to insist that my offer to point her in the direction of gig work was unhelpful as she had some minimum income requirements to pay her student loans etc. Someone who is homeless and has no possession is poor. Someone who has nothing and debts is poorer than that. Don't get into debts as an individual. Just don't. Debt can be a tool for businesses, countries, can be part of an investment plan, you take insurances against unforeseen circumstances, etc... But that whole "I'll get a loan to get a degree" is a tool for servitude. US really needs to get out of that.

twblalock 6y ago
> But that whole "I'll get a loan to get a degree" is a tool for servitude. US really needs to get out of that. You might be surprised to learn that the average student loan balance on graduation in the US is about $30k. That is actually a bit less than the average price of a new car sold last year, which is about $37k. That is not a life-crushing amount of debt. It represents 4 years of college education for the price of a Toyota Camry. Why is it that we think that it's OK to spend that much money on a car, but unconscionable to pay that much for four years of college? Keep in mind that unlike car loans, college loans have public service loan forgiveness, can be postponed when one is unemployed, and have income-based repayment programs. If you don't pay for the Camry it's gonna get towed.
- mapgrep 6y ago
  You have argued that the average student loan debt is not “life crushing”. This is a bit absurd. No one would argue that buying a brand new car for $30k fresh out of school is wise financially for the typical college graduate. Whether it crushes your life or not, it is very ill advised. You have also not addressed the half of debtors who owe more than the average. If the average is so high just think of the figures in the most indebted quarter which is necessarily one million persons per year approximately in the U.S. There is a reason student debt cannot be discharged through normal bankruptcy. It is for many a horrific and crushing burden.
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- jacobush 6y ago
  People are not average. How big is the spread?
- Iv 6y ago
  You are taking a loan assuming: - You will graduate - Your diploma will get you a high paying job If either of these assumptions fail, you are back to square one, poorer than someone who own nothing.
  - twblalock 6y ago
    Then graduate, and major in something that will help you get a job. I needed loans, and I made good decisions with my education, and I graduated -- should that opportunity have been taken away from me because other people did not handle it well?
    - zeckalpha 6y ago
      Didn’t the OP do those things and still end up homeless?
      - twblalock 6y ago
        So? Should the millions of students who rely on loans have their opportunity for an education taken away because of that?
        amanaplanacanal 6y ago
        You seem to be assuming that student loans are the only way to pay for that. In the past most of the money was given as grants rather than loans.
        zeckalpha 6y ago
        No, I’m saying there’s no single way to 100% prevent homelessness
- imgabe 6y ago
  You can declare bankruptcy on the car loan. You can't on the student loan. Because of this, before you take out a car loan, the bank actually checks on how likely you are to pay it back. They don't loan you a $30k to buy a new Camry if you're 17 years old making minimum wage. They will happily loan you that much and more to go college even if you are, because they know you'll just be in debt forever no matter what. We could fix the college loan problem practically overnight by making the loans dischargeable in bankruptcy. Lenders would be on the hook for the risk they're assuming, as they should be. Universities would have to lower tuition because there wouldn't be an endless firehouse of money pointed at them to pay whatever they want. It would fix a lot.
  - twblalock 6y ago
    > They will happily loan you that much and more to go college even if you are, because they know you'll just be in debt forever no matter what. They also give you income-based repayment programs and forbearance if you lose your job. I have never seen similar programs for car loans, or credit cards, or rent, or mortgages.
    - imgabe 6y ago
      Of course they do, they want you to keep racking up fees and interest so you end up paying even more. You'll pay until you're dead. They don't have programs like this for other loans because they don't need them. If they look at your finances when you apply for a mortgage and think you'll need an income-based program, they don't loan you the money. If something happens and you can't pay, they can repossess your car or foreclose on your house to get some of their money back that way. For unsecured debt, even if they don't have special programs, you can usually negotiate a settlement if you can't pay the whole thing. They'd rather get something than nothing. And again, you can discharge it in bankruptcy, so that gives them some incentive to work with you. For rent, there are income-based rent assistance programs in every city I'm familiar with, not sure how it is where you are. We wouldn't need these programs for student debt if you could declare bankruptcy and have the loan discharged that way. It wouldn't be something you would do lightly, but the threat of the possibility would incentivize the banks to make sure that paying the loan is less of a burden than declaring bankruptcy.
OkayPhysicist 6y ago
The fact of the matter is that in the majority of cases, a college degree increases earning potential dramatically enough that loans are definitely worth it. Now, one could argue that if people collectively stopped attending university at current rates then the system would adjust such that people collectively benefit. But people don't act collectively. People make decisions based on personal outcomes, and if spending 40 grand on college increases their lifetime earning potential by 100 grand (not even factoring in the differences in opportunities), then people will take the loans.

by Iv 6y ago

twblalock 6y ago

> But that whole "I'll get a loan to get a degree" is a tool for servitude. US really needs to get out of that. You might be surprised to learn that the average student loan balance on graduation in the US is about $30k. That is actually a bit less than the average price of a new car sold last year, which is about $37k. That is not a life-crushing amount of debt. It represents 4 years of college education for the price of a Toyota Camry. Why is it that we think that it's OK to spend that much money on a car, but unconscionable to pay that much for four years of college? Keep in mind that unlike car loans, college loans have public service loan forgiveness, can be postponed when one is unemployed, and have income-based repayment programs. If you don't pay for the Camry it's gonna get towed.

mapgrep 6y ago
You have argued that the average student loan debt is not “life crushing”. This is a bit absurd. No one would argue that buying a brand new car for $30k fresh out of school is wise financially for the typical college graduate. Whether it crushes your life or not, it is very ill advised. You have also not addressed the half of debtors who owe more than the average. If the average is so high just think of the figures in the most indebted quarter which is necessarily one million persons per year approximately in the U.S. There is a reason student debt cannot be discharged through normal bankruptcy. It is for many a horrific and crushing burden.
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jacobush 6y ago
People are not average. How big is the spread?
Iv 6y ago
You are taking a loan assuming: - You will graduate - Your diploma will get you a high paying job If either of these assumptions fail, you are back to square one, poorer than someone who own nothing.
- twblalock 6y ago
  Then graduate, and major in something that will help you get a job. I needed loans, and I made good decisions with my education, and I graduated -- should that opportunity have been taken away from me because other people did not handle it well?
  - zeckalpha 6y ago
    Didn’t the OP do those things and still end up homeless?
    - twblalock 6y ago
      So? Should the millions of students who rely on loans have their opportunity for an education taken away because of that?
      - amanaplanacanal 6y ago
        You seem to be assuming that student loans are the only way to pay for that. In the past most of the money was given as grants rather than loans.
      - zeckalpha 6y ago
        No, I’m saying there’s no single way to 100% prevent homelessness
imgabe 6y ago
You can declare bankruptcy on the car loan. You can't on the student loan. Because of this, before you take out a car loan, the bank actually checks on how likely you are to pay it back. They don't loan you a $30k to buy a new Camry if you're 17 years old making minimum wage. They will happily loan you that much and more to go college even if you are, because they know you'll just be in debt forever no matter what. We could fix the college loan problem practically overnight by making the loans dischargeable in bankruptcy. Lenders would be on the hook for the risk they're assuming, as they should be. Universities would have to lower tuition because there wouldn't be an endless firehouse of money pointed at them to pay whatever they want. It would fix a lot.
- twblalock 6y ago
  > They will happily loan you that much and more to go college even if you are, because they know you'll just be in debt forever no matter what. They also give you income-based repayment programs and forbearance if you lose your job. I have never seen similar programs for car loans, or credit cards, or rent, or mortgages.
  - imgabe 6y ago
    Of course they do, they want you to keep racking up fees and interest so you end up paying even more. You'll pay until you're dead. They don't have programs like this for other loans because they don't need them. If they look at your finances when you apply for a mortgage and think you'll need an income-based program, they don't loan you the money. If something happens and you can't pay, they can repossess your car or foreclose on your house to get some of their money back that way. For unsecured debt, even if they don't have special programs, you can usually negotiate a settlement if you can't pay the whole thing. They'd rather get something than nothing. And again, you can discharge it in bankruptcy, so that gives them some incentive to work with you. For rent, there are income-based rent assistance programs in every city I'm familiar with, not sure how it is where you are. We wouldn't need these programs for student debt if you could declare bankruptcy and have the loan discharged that way. It wouldn't be something you would do lightly, but the threat of the possibility would incentivize the banks to make sure that paying the loan is less of a burden than declaring bankruptcy.

OkayPhysicist 6y ago

The fact of the matter is that in the majority of cases, a college degree increases earning potential dramatically enough that loans are definitely worth it. Now, one could argue that if people collectively stopped attending university at current rates then the system would adjust such that people collectively benefit. But people don't act collectively. People make decisions based on personal outcomes, and if spending 40 grand on college increases their lifetime earning potential by 100 grand (not even factoring in the differences in opportunities), then people will take the loans.