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When we get another 2008. When enough people default on their debt, the government (i.e. the taxpayers) is now on the hook to guarantee these loans (i.e. bail o
by sooheon 3y ago
When we get another 2008. When enough people default on their debt, the government (i.e. the taxpayers) is now on the hook to guarantee these loans (i.e. bail out the banks).
- riku_iki 3y agoyou can not default on student debt, if default means filing for bankruptcy. Not paying means that some people will just track income and it will be garnished.
- sooheon 3y agoOk, call it delinquency. You can't legally default on student debt, but functionally, those who have not and will never make their repayments have defaulted, you're just not calling it that.
- riku_iki 3y agosome collection agency will go after them and collect payments through court order from their wages.
- sooheon 3y agoYes, and? If the underwriting on the loan is bad (which it is), they won't recover enough. The root problem is those making the loans don't actually have skin in the game because of government guarantees.