Obama Cuts Student Loan Costs! Can Broke Grads Be “Saved”?

Why are the colleges/universities getting off the hook? The cost to attend is outrageous! If we taxpayers are on the hook, costs will sky rocket. Another typical solution for all the issues out their – make the hard working taxpayers pay for the bill! ENOUGH IS ENOUGH

1. In earlier days all scholarships and student aid were based on merit, Welfare aid to students should be ended. If they don’t or can’t perform, the time and expense of studying in inefficient, overpriced colleges and universities will probably have been wasted, and certainly the cost should not be hung on the 50 percent of earners who pay all the income taxes.
2. Many boomers and younger Americans never learned they should store some nuts for the inevitable winters and retirement, but the vote-hungry career politicians bail them out. It’s time for everyone to be held responsible for his own financial commitments.

Once again. You can’t borrow your way out of debt. The graduates need to step up to the plate. Make a plan. And pay that thing off just like everyone else. $29.4K isn’t that big a deal if you just get on it and stay with it. Next time instead of borrowing to go to school consider the W.O.R.K. scholarship and pay as you go and don’t get into this mess again.

Problem is most of these heavy debt students are marginal students attending “for profit” trade schools. Many of these schools have 70% of their students on student loans. In Georgia we provide tuition assistance for students who are serious about their studies. Not much for those pursuing womens studies and basket weaving. The answer to education is to prepare children to make a living. Teach them to do something that someone actually needs and they can make a living. You can’t borrow $100,000 to become a parole officer and have any reasonable hope of paying off the loan and eating too. Too many kids are told you can! We are pushing kids into debt to get jobs that don’t pay. We don’t need more government workers, we need workers who have the ability to make a living in the real world.

Excess student debt is similar to the federal housing debacle. Too many irresponsible people bought homes under federal housing initiatives to make home ownership universal. In similar fashion President Obama and others believe everyone should have the opportunity to attend college. And just like the housing bubble, easy student loan money has attributed to the meteoric rise in the cost of a college education. It’s just too easy for college administrators to pass tuition hikes and other costs to students through student loans.

Thanks to student debt the costs of a college education has increased faster than the cost of living and healthcare over the past several years. For-profit colleges, like the University of Phoenix (Apollo Group), who got in front of the ballooning student debt trend have turned education entrepreneurs into billionaires. The salaries of college presidents is nothing less than amazing.

Unfortunately, the high cost of a college education has made it impossible to work your way through college like many of us did back in the early 1970’s. Today, more students are forced to take on debt and I think many students are using debt to attend graduate school and avoid the dismal job market. The easy money really makes it harder.

Elizabeth Warren came from academia. She’s a friend of college administrators and universities. She can’t see the forest because of the trees. Her legislative agenda might make it easier for students today, but does nothing to address the larger problems of easy student loan money, escalating college costs, and a growing student loan delinquency rate.

President Obama’s recent executive action is designed to buy votes for the mid term. The problem won’t go away. I suspect that down the road we’ll see more aggressive student loan forgiveness policies promoted by liberal politicians, who are also trying to buy votes. Not surprisingly, taxpayers will eat the losses. .

THE BIG PICTURE

President Obama is moving Federal policy towards debt forgiveness for Student loan borrowers. It starts with the 10% rule by 2015. Much of the debt is unpayable, so we have to finesse this fact ( hide it so no “default” takes place). Its part of the trend to transfer wealth from the producers to the debtors or non-producers (takers). Things are complicated but the basis for what he does is pretty easy to see if you are so inclined.

Many people are not looking ahead very far or simply don’t care ( my opinion) and President Obama is craftily taking advantage of the low intelligence of the American voters, collectively. There is nothing Congress can do about it either. Federal indebtedness will keep growing nevertheless and taxpayers will continue to pay for it all through higher taxes and/or inflation. The rest is just “politics”. Been that way for a long, long time. Little changes. Same game, different names, that’s all.

Tuition used to be affordable without loans for most. This was before the government stepped in with guarantees on student loans. The result was higher education cost by institutions. The solution is for the government to get out of the student loan guarantee business and allow resulting market forces to reduce education costs (ie: deflate the tuition bubble).

While we should make it easier for students to pay down their loans on time- we must be careful with the message doing so sends to them and everyone else. With 5 childden already in or nearing college age, im already hearing stories they bring home of some who’ve verbalized their intent to become long-time students because they know ar some point much of the debt they will have created for themselves will never need to be repaid. This is warped thinking. What’s next-forgiving their auto loans as well because the car is a necessity for getting to work?
Lets be smart when offering some relief to student borrowers AND penalize schools that increase annual budgets beyond the inflation rate by cutting off access to federal backed funds through which they eagerly entice new student enrollment.

i agree with the thought that they penalize planners and it has always made me mad that i paid for my children’s college if they went and now the gov. is asking me to pay for the non planners childern’s so i get a double hit for my kids and the spendthrift’s kids what happened to paying your own way in life and not go running to the gov. that is making a generation of adults that think they sould get what ever they want even if they can’t pay for it. i understand that some people have to have help but that doesn’t include everyone. people don’t know how to save any more. and the gov only knows one thing tax and spend so the middle class suffers.

More vote buying by the socialists. Once upon a time one was honor-bound to pay one’s debts. Today all are ‘above average’ and encouraged to go to college, where every subject that ends in ‘ies’ is worthless. The federal government has no business in the lending business, for anyone – but the socialists delight in burning taxpayer dollars for their ridiculous schemes

It’s another “feel good” non-solution. As a student who worked his way thru a private university by taking any job offered, I have no sympathy for those who borrow money and really don’t expect to pay it back. Debt is destroying our Nation, and adding to it will only hasten the problem.

Instead of producing a generation or more of under educated or inexorably indebted graduates, a dramatic roll back of college tuition rates would more than likely realize an eventual savings from the increased tax revenue resulting from a better educated workforce. Additionally, penalizing our graduates with legislation passed in the previous administration which prohibited the bankrupt to excuse student loan debt needs to be repealed. I am recalling the greatest growth of our middle class as a direct result of the incentives offered up in the Servicemen’s Readjustment Act of 1944, more commonly known as the G.I. Bill. That legislation made possible for an otherwise struggling generation to access lower education costs to colleges or trade schools, expanded unemployment benefits, low interest mortgages and insured loans. These measures are not only needed now, but paid for themselves then and would again if implemented.

More pandering by Obama to a special interest group. Like addictive drugs, the plan is to hook your voters long-term once they become dependent on government giveaways. It’s another reckless disregard of our nation’s debt situation.
College costs rise every year because of the accessibility of easy government money. Want to truly help the students without adding more taxpayer debt? Reduce that easy government funding and lower student loan interest rates. The colleges will have to cut their fat (ie; administrators), level off their annual costs and the interest on loans will accrue at lower levels.

And where is the money for relief of student debt going to come from — the average citizen, who are trying to feed themselves now? I feel for student’s problem loans, but they should blame the government for making these loans without any culpability. Let’s try holding them responsible for the decisions.

Blame for this situation should rest with two parties, Colleges and Corporations. Why do colleges insist on 4 year durations for an undergrad degree. I can tell you from personal exp that less than half of my courseload actually related to my majors (yes i had two). Colleges claim it makes you ‘well rounded’ but seriously it just does no such thing! Plus todays kids are more globally connected/aware than any generation has ever been. Secondly if you look at job descriptions posted by Corp HR depts, they all ask for bachelors and MBA’s (or equivalent) for non-executive positions. Why?!? These are not skills!!! And by the time you get to an exec position, your formal education is worthless. The real skills gap is between the ears of HR depts!

I am adamantly opposed to Obama’s’ tax relief for students. Students borrowed the money now let them live up to their responsibility and pay the money back. Some students are beginning to realize that acquiring a four year degree or higher at the expense of thousands of dollars in debt with no job after graduation may not be worth it. Not everyone is cut out to be a college professor. Furthermore, there is probably more need for electricians, boiler makers or carpenters than some one with a liberal arts degree. Why not promote more tech schools where there are more jobs available?

It appears that anymore very few wants to accept responsibility for their own actions. No one pays my bills when I get over my head but I learn from my mistakes. Responsible people that have been thrifty and saved some money are now being punished by the Federal Reserve in order to bail out those that have bee reckless and irresponsible. This reckless philosophy which this President appears to promote is not good for our country.

This indebtedness that the youth of the nation take on with their education shouldn’t hamstring them too severely. The sound of a maximum 1o% of their income going towards the debt sounds fair enough. Not being very well informed about this problem, this may seem a bit ignorant. The way I see it, the politicians are just blowing smoke. The House, due to their leanings won’t let it happen. The administration and the Senate are just making noise that they think the people want to hear. It sounds good to me but it’s NOT going to happen.

Well, as usual, the Obama proposal doesn’t kick in immediately, or even later this year, but NEXT year sometime. Just great. Still, it’s better than nothing I suppose.
Warren’s proposal is better,of course, but doesn’t have a chance in the House. (as usual).

I think our universities should train their students that an individual has a moral obligation to pay his debts. Setting up procedures to borrow money which you think you plan to default on later does not equip a student to manage his affairs in the adult world. A debt relief program similar to this has been in effect for some time for federal employees. As a group these folks have our government spending almost twice as much as it earns with no realistic plan to ever pay it back.

The whole student loan program is not conducted correctly. The loans should only be given out for students that satisfy a need for specific talent that is required for this country such as Doctors, Engineers, etc. The high schools and colleges need to bring back courses in the blue collar degrees such as electrician, framer, plumber, etc funded by private business that need a specific type of talent. There is a lot more to say about the above but the loans to students is wrong for them and the country.

Student loans resemble NINJA* mortgage loans of 2004-2008. Just as NINJA mortgage loans resulted in sky high real estate prices 2004-2008, NINJA student loans result in sky high college tuition. Just as Fannie and Freddie now have stricter lending standards for mortgage loans, stricter lending standards for student loans should be established.

Students and parents who have taken out loans should repay them in full at the interest rate stated in the contact. Y should non-college graduates be asked to subsidize student loans?

*Definition of ‘NINJA Loan’
A slang term for a loan extended to a borrower with “no income, no job and no assets”. Whereas most lenders require the borrower to show a stable stream of income or sufficient collateral, a NINJA loan ignores the verification process.

It’s the skyrocketing cost of higher education that’s the problem. Reduce the cost of college and the loan problem will take care of its self.

Admit I am not fully cognizant of all aspects of American politics, but it appears to me that Obama is increasingly using Executive Order to implement his policies. That, and the rising power of Homeland Security, makes me uncomfortable – and I live in Canada.

Colleges and Universities have a large and growing number of foreign and non-citizen students. While they pay more than residents, their cost to attend U.S. funded, developed and supported public institutions should be VERY HIGH. They obtain a lot of benefit, for what in the long run is relatively low cost. Their cost increase could help REDUCE the cost for U.S. students.

We all pay for someone for something some times in our life, either through taxes, or interest on loans and when we feel we need to help others (which all good hearted people do) is give some one in need a helping hand. My thoughts are that if these kids were rich they wouldn’t need government help. The taxes that every one pays, the government spends a lot of it stupidly I think. They give other country’s 3 billion a year to help them out and a lot of it goes into someone’s pocket instead of helping their citizens like it is supposed to. That is our taxes and they are giving more than one country cash every year. I would rather see our children be given my taxes instead of some country that doesn’t like us anyway!!! As far as I’m concerned they could forgive the loan so the kids can have a better start and also they can raise the minimum wage at the same time.

I read some of the comments above and it sounds like some of you never got any help growing up. I am sorry about that!!!

Cut out student loans entirely and you will see the tuition cost of college reduce dramatically. Student loans (the third party payor) gives colleges the opportunity to increase costs because the government will be financing it on the backs of students. It is a terrible system.

I graduated from the University of Miami in 1965 [ 1966 ] My last year there the President
of the University sent us a letter regretting that tuition would be increased $ 50.00 a semester from $ 450.00 to $ 500.00 ………..total for year $ 1000.00 .
Now 48 years later the tuition at the University of Miami is over $ 39,000.00 . Absolutely obscene . In Germany and probably most of Europe their yearly tuition is about 1200 Euros a year , $ 1600.00 U.S. dollars . But a good part of the difference is that they only allow qualified intelligent students into the University not the low I.Q. students as in the U.S.
Also their system concentrates on academics not foolish courses such as Black Studies or the benefits of Multiculturalism . I recently read that the average student was $ 26,000.00 , I would venture to say many students actually have more than $ 50,000.00 +
in debt [ plus interest ] Greed in this country knows no bounds , the Corporate World , Wall Street , the Banksters and our elected ” public servants . ” I do believe that this is the beginning of the end for the U.S.

Most college students, especially college freshmen, are clueless about what major or occupation they should be pursuing. Such confusion and uncertainty leads to a huge percentage of college students dropping out of college unnecessarily (because many of these students end up switching their college major, which adds 1-3 years of time for the student to graduate, plus tens of thousands of dollars of additional expense for these students; all too many of such students end up running out of time and money which leads to their dropping out). Meanwhile, a large percentage of students who do manage to tough it out and finally graduate often end up graduating in a major that does not fit well with their aptitudes and interests, which results in these students being less productive in the workforce (should they succeed in landing a job that’s related to their college major).
All of the above negatively impacts the overall economy–and this is not even taking into account the enormous student loan debt problem.
What needs to be done is to pass legislation–at either the state or federal level–that requires all incoming college freshmen take a high validity interest test prior to their signing up for their first semester classes and selecting a college major or vocational training program. This can be done at $0 cost, as each college possesses a Career Center where such high validity interest tests are offered for students to take for free. Because colleges do not require their students to take such a test, very few college students ever take these highly-valuable tests, leading to most college students being uncertain about what direction they should be pursuing with respect to their occupational goal and college major.
Only one state–California–has passed the above-described legislation, and it takes effect this coming August, 2014 for all incoming California community college freshmen. The legislation, which is now California law, is called the Seymour-Campbell Student Success Act of 2012, and it was bill number SB1456 when it was a bill in the California legislature (it passed the California Legislature almost unanimously; only one legislator voted “no”).
Until colleges in all 50 states of this country see to it that incoming freshmen from Day 1 in college get into logical majors and occupational training programs, based on the student’s interests and aptitudes, the student debt problem is only going to continue to worsen, and the problem of college students graduating in majors that they are ill-suited for (based on their interests and aptitudes), which makes such students less productive workers should they end up in the workforce, will continue.

It is a great law for the students that owe so much money for student loans. However, if the cost of a collegs education keeps increasing these loans will become larger.
The ouestion is how to stop the ever increasing cost of college?

Since most of the colleges take a lot of government money let the colleges refund the money for the extremely high costs of attending each college. You have Tenure for many professors that work 4-6 hours per week and write books and do projects that they sell and the taxpayer is paying all of this plus the cost to attend college. $30,000 to $70,000 a year is insane to attend college and have your children be lectured by many left wing professors who are living large off of the system that they constantly berate. To lower cost of college is simple: Get the government out and have professors that really teach.

I like the idea of charging students prime rate during repayment period. My thoughts are to make the student loans payable to the attending school and if the student does not attend or drop out – then the school has to refund the money. It’s too easy to get the loans in the first place, and allowing students to take the money and spend it however they please is a bad idea. I know of too many people who take the money and run, never having any intention of going to school OR intending on paying it back. This happened excessively starting in 2008 as people lost their jobs and portended to go to school to enhance their skills/worth in the job market, but never did go to school or quit shortly after getting the money. A lot of people do this because they know the Gov is not good at tracking them down and forcing payments. Part of the poor re-payment record is the Gov’s problem. I had heard of some company’s buying the debt from the Gov. at a cut rate price, and then they have a high incentive to track down deadbeats and collecting. These companies are doing very well – collecting much more than the Gov ever has.

The corruption at the administrative level of all public (maybe private, too, I don’t know) education in the US is as corrupt as that in Washington. We need a whole new crop of administrators as badly as we need a whole new Congress. They are fleecing the students just the same as Washington has turned us all into debt slaves. I believe the bulk of tuition pays salaries, perks, and outrageous benefits that are not deserved as well as other stealing and skiimming, and I do not mean the professors salaries. Selfishness and dishonesty is the order of the day.

It seems that several things are overlooked here – and I don’t know the answers, but maybe someone here can explain:

1) Parents who fill out the FAFSA could be subject to ParentPLUS loans at the college, but it is not part of the small print included in accompanying literature. As a result, the amount that you receive as payable to the college is not the true amount a parent will be paying. Yet, parent loans are not addressed in the 10% of income and these loans are at fixed rates that cannot be refinanced to lower rates. If you don’t make a payment during one pay period, the amount is added on to the back of the loan. When will this inconsistency be addressed?

2) Institutions of higher learning, both secular and faith-based, have no tax responsibilities to the host community. If they did, they might be conscientious in analyzing their income and assets against the payments and liabilities that they are now paying. Many staffers are well-schooled to teach in cross-disciplines and they are not working a full day at the school. Their full-time jobs take a priority. What would happen if higher education were to require full-time hours from these professors along with community placement for graduates from their program(s)?

3) When a college lowers its tuition, only then should they receive a tax BREAK for that year. Taxes on a business are not permanently eliminated. Why should educational facilities be tax-free?

4) Elimination of the federal Department of Education would allow you to see “your tax dollars at work” in the state where you live. Having both a federal and state Department of Education is a prime example of wasteful duplication. Why can’t a state Department of Education take responsibility for schools and teachers in each state?

Anyone with those answers, please raise your hand …

Get rid of all the FLUFF courses required for a degree! Colleges rake in tons of money for basket weaving and phys ed courses to satisfy a degree for a “well rounded student” What a scam!. Taxpayers are on the hook for all that!

This is not only outrageously funny but seriously dangerous!
Obama, who has been the biggest deficit spender – and the fastest one – in history, increasing US govt. debt from $10.626 trillion over $17.726 trillion in about 5.75 years, Trying to advise students to manage their debt?
This is really unbelievable !