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I'm arguing that the current rate is without the additional percentages that the insane risk premium that would be attached to these loans, if they were made at

I'm arguing that the current rate is without the additional percentages that the insane risk premium that would be attached to these loans, if they were made at all. > is already jacked If you're arguing why it's not the same rate as treasuries, I'm not sure what more I can say. There's more that goes onto pricing loans than just the risk premium. It's a part of it, but not the whole story ("why are government-backed MBSes not the same interest rate as treasuries?"). Furthermore, just look around: you sure there's no "risk" with these loans? You cannot in honesty argue otherwise.

prepend 3y ago
I’m arguing that the rate is already artificial and borrowers are paying more than they should. So increasing lender costs would not necessarily increase rates since rates are set by something other than the market. When I took out student loans in 2013, I got a 6.5% rate for 25 years. It can’t be discharged and any default is guaranteed by US Department of Ed (eg, I die, or use income based repayment for 25 years and discharge the balance). So to the borrower, the “risk” is that the USG defaults. For comparison, I bought a house that year and got a 4.25% 30-year mortgage that has my house as collateral. Why would a student loan that can’t be discharged have a higher rate than a mortgage?