...nearly half of [student loan] borrowers haven’t resumed payments

[Gollum]

"...almost 20 million borrowers have resumed making payments on their student loans, while roughly 19 million haven’t done so, leaving their accounts in a state of delinquency, default or otherwise paused through deferment or forbearance..."

"...42.8 million recipients of federal student loans owed a total of $1.62 trillion in debt as of the end of March."

https://nypost.com/2024/07/04/us-news/american-student-loan-ballance-tops-1-6-trillion-half-of-borro... (July 04, 2024)

[CreditCuriosity]

Hopefully their credit is being punished for this as no excuse not to be paying them as they were being paid before pandemic and things are back to normal other than inflation and everything being more expensive.  Hopefully they aren't forgiven or reinforces bad behavior and passes the burden to normal tax payers and futures ones  for generations to come.   They took out the loan they owe the loan. 

[kyorgi]

I agree on the personal responsibility front, however you have to admit that the current administration has been giving increasingly mixed messaging regarding loan forgiveness.

The number of emails I received from Federal Lending Providers saying essentially "the Supreme Court said no, but the administration (and Sec. of Education) says hold on" continues to be confusing and I can't imagine how much worse it will be for students who aren't financially literate.

I didn't take out that big of a loan (mainly for housing expenses) compared to my classmates, but I was informed my payments won't be due until later this year so I'm riding that out to make more money in the meantime to pay them back.

[CreditCuriosity]

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@kyorgi wrote:

I agree on the personal responsibility front, however you have to admit that the current administration has been giving increasingly mixed messaging regarding loan forgiveness.

The number of emails I received from Federal Lending Providers saying essentially "the Supreme Court said no, but the administration (and Sec. of Education) says hold on" continues to be confusing and I can't imagine how much worse it will be for students who aren't financially literate.

I didn't take out that big of a loan (mainly for housing expenses) compared to my classmates, but I was informed my payments won't be due until later this year so I'm riding that out to make more money in the meantime to pay them back.

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Current admin has been shut down by the SCOTUS already yet they try to skirt around the ruling and the laws and many lawsuits are going on at state levels is all I will say about it and likely the current admin won't be around in January.     They know exactly what they are doing.

[FrankenBeans]

As with all things Fox News and NY Post, the headline is misleading, and the "article" neglects to mention many borrowers have been instructed they don't have to start back up with payments yet. 

At least, they didn't carry on with the false narrative of "burdening taxpayers" 

Student loans are a predatory racket. 

[Waginator]

Uh, excuse me but people need to mind own business and not shoot their mouth off about things you don't understand. Some student loans need to be forgiven, and if they were, would not be a burden to you. Ive been paying taxes for many years and if I want my tax dollars to pay for my loans, that should be my option. 

I was pushed into going to college at 17 1/2 , had no idea of a major, and graduated with a worthless L.A. degree. I was also treated poorly by the school (Penn State). I'm not paying another dime towards my loans. I still need to go to college all over again( I'm over 50) to get a real degree now that I have a major. I am not transferring any credits.

I'm tired of the simplistic attitude from ignorant people  who see this in one dimension. "You signed the papers you pay off the loan"

No. The educational system is predatory if not navigated right. 

When I go back to college, I will start over again as a new student and get scholarships and grants. 

[Windchill92]

A forgiven student loan is literally the same as a scholarship with no merit requirements, so those who received merit scholarships and paid the rest out of pocket inevitably paid more for their education than those who took full loans for a useless degree. Whether or not the $Dollar amount forgiveness is extracted from citizen Joe's taxes is another topic, but the previously mentioned situation is clearly unfair from a merit standpoint.

Not sure how the Federal Student loans are predatory if it is clearly called a "loan"...which, by definition, must be paid back. I had a Federal Student Loan offered to me every single semester, and there was a clear option to accept or decline it. By applying for and using a credit card, I am accepting the terms & conditions set up by the issuer...which isn't predatory because all the contractual T&C were laid out. I've never taken out a payday loan, but I'd imagine there's some T&C that I'd have to sign to get one.

But perhaps the term "loan" has been used too much and softened its connotation such that loan recipients don't feel the need to pay it back—completely opposite its purpose. I do think payday loans are predatory due to their insane APRs% and advertising...and perhaps it's the advertising of student loans that is the problem?

side note: IMO student loans should only be offered for STEM/business degrees, i.e., where yield jobs with a salary that can support any COL and Loan Principal + Interest. I also 100% think tuition is too expensive at any school and that they should tap into their endowment fund several % more than what they currently do since tuition/fees represents only a small portion of revenue.

edit: typo

[Spotsy]

This is a charged topic and has many moving parts.  But a few points of this "student loan forgiveness " policy to consider when debating:

-the loans are already subsidized by the government , hence the cheap interest rates passed to students

-the ones mainly filing the lawsuits are the organizations servicing the loans, since they won't be able to make money from these loans in the form of  subsidized interest that is charged to the student, with the rest being paid by the government.

-even if a default occurs, the government is still on the hook..but wait, you can't file bankruptcy on these loans...so the government and student are on the hook, until you are dead.

ponder this, who is the villain in the situation:

-the school for significantly raising tuition due to the fact that you cannot go bankrupt and need to education

-the student for taking out a loan for further education

-the loan servicing company for offering the loan so they can make there interest and be fully insured/guaranteed to be paid by the government

-the government for paying the principal of the loan off early using the same funds that were to pay for the subsidized interest over the full term of the loan

I do believe there need the be additional controls around issuing loans such as limits, lifetime or otherwise.  Schools need to be under better guidance/guardrails on tuition rates and max amounts that can be charged and be under federal bankruptcy protection.  Students should be under more restrictions as to what the federally subsidized and insured loans can be used for, let alone eligibility .  Maybe just the first 4 years of undergrad, no master, doctorate, phd, etc....higher level courses?  

I got loans for my college years and paid them in full on my own....but back then it didn't cost me 100k for a 4 year degree....I spent about 30k....nowadays 100k+ for a simple undergrad, not even a medical degree, is common ....that is insane! I personally have no problem with the loan forgiveness efforts, but there need to be more guardrails on that program or it is just as bad as when stundent loans were put under bankruptcy protection and schools went crazy with tuition rates.

P.S.  Don't let the media get you spun up on this topic as it is being spun by them to generate interest / revenue for them when u read/watch their stories.  To them it's about making money off you, just like the student loan mess.  No matter how you spin this, the tax payer is funding this, the ones that are losing money is the loan servicing company.

[Windchill92]

Thanks for the food 4 thought, @Spotsy. Well done response.

[Anonymous]

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@Spotsy wrote:

 Don't let the media get you spun up on any topic as they are all spun to generate interest / revenue for them when u read/watch their stories.

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Dirty Laundry - Don Henley

https://www.youtube.com/watch?v=fwgJgTL5JmE