4 ms·
It does indeed go to a bank's balance sheet, and it also eliminates a monthly source of income expenditure from a household. If the interest amount is more tha
by karmelapple 4y ago
It does indeed go to a bank's balance sheet, and it also eliminates a monthly source of income expenditure from a household.
If the interest amount is more than 0%, it may give more income over the course of the loan term for the person with debt than it wipes out at the bank.
The money someone was spending on the loan and interest may very well go to any number of consumer goods, investments, or other items, though.
- ahahahahah 4y ago> it also eliminates a monthly source of income expenditure from a household > The money someone was spending on the loan and interest may ... Not in this case. Federal student loan payments have been paused for over 2 years now, people have not been making monthly payments for these loans.
- Auracle 4y agoWhich, for the past year or so, has been a completely insane policy. The economy is fine other than inflation and the pause is only causing more of it.
- xg15 4y agoThat's sort of the point of the whole exercise though. If you take issue with that, then by the same logic you could also argue that any attempt to help a person pay off debt is encouraging frivolous spending - after all, once the debt is repaid, the person has additional income available which they can spend on things.