It all went to hell in 2005 because of this little gem: http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and_Consumer_Protection_Act http://en.wikipedi

It all went to hell in 2005 because of this little gem: http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and_Consumer_Protection_Act http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and... See, there are two primary forms of financing for higher education: The heavily regulated federal market, where the federal government guarantees the loans, but also maintains rules that ensure that repayment is affordable by way of myriad flexibility in repayment (including a very reasonable $50k total cap in principal lended), and the private market which is very much similar to other forms of consumer financing. The BAPCPA changed the rules and handed out protection to private lenders outside of the federal system that made private student loans special in that they became nondischargable in bankruptcy. Now take a room, throw in some profit hungry lenders drunk on an elixir or reduced risk prepared by the federal government, a bunch of kids that aren't old enough to drink, some old school notions about the value of expensive college degrees, more old school notions about the value of liberal arts degrees and a pile of overzealous university administrators looking to expand by pushing overpriced preparation for vaporcareers and guess what you get, this mess.