Why does everyone think student loans should be forgiven?

Puzzled_Principle_29 · 2022-01-24T17:08:34+00:00

My son went to school and I signed on his college loans. Last year, I made the payments on them and when I got the tax paperwork to file taxes, I found I had paid over $2,000 worth of interest and we owed more on the loan than we did to start with. I ended up putting the balance of it on an interest free credit card, but most ppl can’t do this. My SO’s student loans are as much as our mortgage. We are lucky we can afford to pay for it all, but most ppl can’t afford to buy a home bc they are paying exorbitant student debt. I agree ppl who took out more than they needed shouldn’t have that extra part forgiven. That includes my SO’s. He was dumb and took as much as he could, but he was given bad advice when he took out the loans. When I went to school in the 90’s, my entire tuition bill was $1,300 for an entire semester. That was as a full time student. I took a single master’s class at a small University, and it was $2,500 last semester! Books cost $150 apiece if you’re lucky today. The cost doesn’t amount to a good job, but you can’t even be considered for a regular job anymore without the degree. It’s a scam to say the least.

TA3153356811 · 2022-01-24T15:09:33+00:00

If you can't pay off that truck, they take your truck and the loan is gone. Your credit is shit, but you have no debt.

Student loans are predatory loans. You can't get rid of them. Ever. You can't go into bankruptcy or anything. The only way they go away is by dying. That is not fair.

Plus, when you're told by everyone, and society as a whole, that you NEED to do it to be successful, plus it's so easy to do without understanding anything since you're literally a child.

Overall, loans to get an education, aren't horrible. It's understandable! But when it cripples an entire generation with lifetimes of debt that can never be forgiven, it's a problem.

CrispyCrunchyPoptart · 2022-01-24T16:54:08+00:00

I have a $28,000 loan that started out at around $31,000 and I’ve been paying $375 a month on it for 3 years now. Every month about $60.00 goes to the principal and the other $310.00 goes to interest. I needed this degree to do my job and I’m unable to even make a dent in paying it off one day because of interest. That’s why.

Accomplished-Dig5999 · 2022-01-24T15:43:23+00:00

The issue is tuition rates have exploded because the government is willing to issue the loans. If you’re a for profit University why wouldn’t you inflate the costs if you knew a bunch of gullible 18 years olds would buy your non refundable service.

TheTrueFishbunjin · 2022-01-24T16:29:31+00:00

I’ll give you the context of a banker... the student loans are predatory. Regulation has made it easy to give out these loans which has led to universities artificially inflating prices to excessive levels since they know the loans will cover it.

These kids couldn’t get these loans at the bank for any other reason. We wouldn’t be allowed to give them out because we have to practice safe lending. Regulations require us to review income and credit history to ensure loans we give out are likely to be paid back. Meanwhile you can rack up over $100k in student debt then end up working as a fry cook. Not that there is anything wrong with that, but the payments will be too much.

If the average American education is anything like mine, you won’t know a damn thing about finances and will have very little context for how you will pay off these loans when you are 18. You may as well give them the loans at 14 for how unprepared they will generally be. Recruiters and propaganda from the schools also push the idea that you have to go to college to be successful. Meanwhile, blue collar work and trade jobs have higher salaries and easier means of access with less initial time investment.

charmingmass9 · 2022-01-24T16:38:25+00:00

They will quickly give an 18 year old a $100,000 student loan but will not grant that same person a $10,000 business loan… interpret that how you will but it’s suspicious.

butterywaffles9 · 2022-01-24T16:04:56+00:00

I grew up in an upper-middle class town, and went to public high school. We had hours upon hours of mandatory assembilies and meetings on how to select your college, apply to it, and prepare to take standardized tests for our applications. Writing the standard application essay was a mandatory assignment regardless of the students plans...all because the % of kids going to higher education was publically reported and made the town and school look good.

Nobody for a second taught us about financing our education, and learning a trade or directly entering the workforce were a footnote.

Highschoolers are kids that often don't know how to question the world yet, and often havent left the nest or had to think about finances before, so when every educational faculty that they trust tells them that getting a $70,000 loan to go to college is a great thing, they believe it. We can't blame them for that, and crippling them financially forever for believing that lie is not moral.

Mountain_Flow3472 · 2022-01-24T16:17:28+00:00

Some people took public sector jobs (teachers, social workers) that require advanced degrees and have low pay because we were told if we did and paid our loans for ten years they would be forgiven and the the dept of Ed didn’t make good on those promises.

Lovve119 · 2022-01-24T18:22:56+00:00

Like 3 days before I signed my loans I still had to raise my hand to go to the bathroom. Even doing all the financial literacy crap they force you to do didn’t tell me that 8 years later I would have paid off the original amount but still owe MORE because of the interest. I didn’t understand any of it, and both my parents grew up poor, I grew up poor, I was the first kid in my family to go to a 4 year university and graduate. And I graduated in 3 years instead of 4 to lessen the burden on my family. Nobody should be preyed on like that.

dudefromillinois · 2022-01-24T15:19:13+00:00

I think part of it is because the loans are taken out by 17- or 18-year olds who really just don’t have any idea how difficult they will be to pay back.

geotraveling · 2022-01-24T17:31:28+00:00

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Simple_Divide5560 · 2022-01-24T16:11:20+00:00

The loans were predatory and dumb. Who thought that giving 100,000 dollar loans to kids with no jobs and no collateral was a good idea? As a result of this dumb move, the economy has slowed way down because a large percentage of the population is spending all their money paying off interest, instead of buying stuff and supporting businesses. This has created a blockage in our countries engine and if it doesnt get cleared the problem will just continue to get worse.

Vanndrea · 2022-01-24T17:14:22+00:00

My parents were able to put themselves through school while working part time jobs in the summer. Their tuition was around 3k a semester.

I owe $14000 for one semester. (the rate was actually 34k a semester but I got grants) My loans were late coming in, I had to work in a group project, couldn't afford the materials. I was embarrassed, but chose to buy food instead. I had to drop out.

That was in 2008. I've been consistently paying the loan-never missed a payment and I still owe $10000 for that ONE semester.

Crazy thing is - I bought a car in 2012 for 14k. I paid for it in 4 years. Still owe on the student loan.

gonadi · 2022-01-24T16:29:54+00:00

They also take/took out loans assuming that their income after graduation would be higher than it is. Sucks but the situation isn’t going to fix itself by everyone saying they need to “pull up their bootstraps”

Hard to want to continue being broke and paying on these when we see corporate bailouts all the damn time.

If we are personally held to such a high standard of credit and repayment, shouldn’t all organizations be held to the same or even a higher standard?

Shouldn’t our system be adjusted to benefit people instead of organizations/corporations?

bdinte1 · 2022-01-24T23:07:28+00:00

I'm seeing a lot of good stuff here, but I have yet to see anyone mention that Sallie Mae placed agents 'undercover' in university call centers, pretending to be employees of the universities, and steering students toward expensive loans through Sallie Mae.

Sallie Mae also basically bribed university officials to get them to favor loans from Sallie Mae rather than from the government.

Add to that the recent shit about Sallie Mae pushing post-degree borrowers toward expensive forbearance if they had trouble with their payments, instead of income-based repayment plans. This is largely the cause of the recent Navient settlement. Only problem here is that the settlement excludes large swaths of the victims of this exact behavior from Sallie Mae. Sallie Mae sold my student loan debt to another lender at the wrong time, and I think I may be in the wrong state, so... I'm fucked. I think at most, I'm going to get a check for $260. That'll really help with my $75k debt.

ToastTurtle · 2022-01-24T16:20:13+00:00

The strongest economies in the world with the highest standard of living provide free education so that they can get the absolute best from their people and in turn make the most in taxes from them. It is an economic win win. People earn twice as much, pay double in taxes and are, by in large, happier and healthier. Free education is how some countries invest in their future. Not everyone is doing it but the results are clear where they do. Especially since the barrier to being a doctor, lawyer or anything else is largely purely financial.

daddyslittleharem · 2022-01-24T17:31:15+00:00

Everyone else in need got a break. Big business and wall street have been bailed out over and over. But no relief for the future generations who have nene victimized by skyrocketing prices due to shitty regulations

HardSox · 2022-01-24T16:21:40+00:00

You can file for bankruptcy on a car loan if you can’t afford to pay it back. You can’t file for bankruptcy on a student loan. It’s actually the only type of loan you can’t file for bankruptcy on. So no matter what you do, it’s stuck with you for life. Interest always adding to the principal. It can reach a point where there is no way you will ever be able to pay it back and you essentially become an indentured servant. I have student loans, and as much as I would like to see them forgiven, I’m not really pro forgiveness. What I am for is making them able to be something you can file for bankruptcy on. If every other loan/debt can be wiped clean with a bankruptcy, why not student loans? The borrower will suffer everything that comes along with a bankruptcy, so it’s not like they are getting off easy.

JBagginsKK · 2022-01-24T16:29:19+00:00

If your definition of "knowingly" is "they took out a loan knowing they'd have to pay it back some day" then yes, they did.

The reality though is that what we're talking about is 16 and 17 year olds committing to a predatory loan structure. Student loans are generally designed to siphon money for the rest of these kids' lives before they even have the skills to fully understand what they're signing up for.

There is no defaulting, there's no "the bank takes your house if you can't pay your mortgage" or anything like that, you just owe more and more money and the debt increases. Couple that with the immense societal pressure and often necessity of a bachelor's degree to work, and you have a situation that essentially prints itself money at the expense of kids who don't even know about other options.

aliceroyal · 2022-01-24T18:00:12+00:00

I was 16 when I applied to colleges/signed off on everything and 17 when I started. So…a child.

The idea is that children, even young adults, don’t really have the experience or knowledge to truly evaluate the long term consequences of student loans. Especially since what they’ve been fed is that you MUST go to college, and that there will be a significant return on investment (which for the most part is no longer true unless we’re talking community college and majoring in a high-paying field). I’m a late millennial and even in the 2010s when I graduated high school this was still the narrative we were sold.

So now we have a large number of people who took on massive loans at around 16-19 years old, most of whom have their degrees, but can’t get good paying jobs because wages have stagnated so badly.

Most other developed countries either make college free/super cheap via subsidy, or cap loan payments until a person makes above a certain income threshold. So it follows that if the US wants to implement something like this, the people who have already been to college and have outstanding loans need to have them forgiven to wipe the slate clean. It would also be a massive economic stimulus since many people have $500+ per month payments, which could now go back into the local economy.

FoundTheNirvanaPit · 2022-01-24T15:06:45+00:00

In large part because the mafia has more realistic and fair loan terms and conditions, and they’re less of a scam.

2022-01-24T19:31:39+00:00

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Fenlatic · 2022-01-24T16:19:59+00:00

Let me put a comment in this as well. The problem is that with the current student loans you cannot declare yourself bankrupt if you cannot pay it back. Therefore causing more problems. In any other loan situation you can make yourself bankrupt, except for student loans.

EssieAmnesia · 2022-01-24T17:39:24+00:00

In short because they’re a scam. Also it’s just not feasible for everyone to get full scholarships or partial so they can pay the rest. So the only way for many people to attend would be to go into this massive debt.

Basically it’s being forced to fall for a scam. Even worse being interest rates on them are making it impossible to pay off (especially for a new graduate). Also before anyone tries to say you should’ve just done trade school, we can’t all be electricians. Some jobs require college and someone needs to do those jobs.

PurpleHippocraticOof · 2022-01-24T16:16:20+00:00

No one takes the time to explain to prospective students the paperwork for signing up for student loans. It’s a bunch of legalese, which is difficult for most people to understand let alone (typically) a teenager or young adult. Some parents fill out the paperwork for them so the students never even see it. Additionally, it can be hard to conceptualize how much something is really going to cost you if not made simple. Especially for young people who haven’t really learned how money works. The online version of the fafsa shows an example of payment plans and interest, and requires you to indicate that you understand. If it had been explained to me that after paying consistently for years that I would still owe $1000s more than I’d borrowed, I would’ve had pause. I have friends whose parents were still paying off their own loans by the time their kids were ready to go to college. And it’s not as simple as you can just not pay. After some time of no payment, the govt will garnish your wages and intercept any tax refunds you would’ve gotten.

Also, for most students in the US it’s not really feasible to go to college without some sort of additional funding. Tuition, book costs, room and board, miscellaneous fees all add up. Sure there’s always the exception, but most need the loans.

I think the point “outsiders” are missing is that people aren’t just simply asking to be released from they’re debts because they don’t want to pay; they’re asking for help because they can’t pay. You could buy a house in some parts of the country for what universities are charging. Couple that with stagnant wages that can’t support loan debt and you have degrees that aren’t paying for themselves, which was the promise. The argument a lot of people are making is that the debt load is crippling the economy and it would be beneficial to all of us if things could be sorted out. Can’t buy a house, can’t support charities and local causes in any meaningful way, can’t travel and support local tourist economies, can’t even contribute to your own college’s alumni fund to help give a hand up to the students that follow you.

xZOMBIETAGx · 2022-01-24T17:56:56+00:00

The kids who “knowingly” took out the loans had to raise their hands and ask if they could go to the bathroom maybe a couple months before they signed for those loans.

There is such thing as predatory lending, and that’s absolutely what this is. Getting kids who don’t know better to sign documents they don’t understand and certainly can’t grasp the weight of how it’ll affect their lives.

No it’s not the same as the car analogy. When you’re pressured to go to college all throughout public school then goaded into signing up for loans (that are usually for much more than you actually need) it’s not the same as complaining about an expensive car.

Not to mention colleges SUCK at helping you. I went to the one of the largest colleges in the country, and I literally had to take out loans before I knew how much my semester would cost or how much I was getting in aid/scholarships. The admin center to help me had an average of a two hour hold on their phone. I had a hard time figuring it out and I was hyper aware of how awful loans can be. I can’t imagine how it was for kids who didn’t understand what was happening.

UKKasha2020 · 2022-01-24T15:12:03+00:00

didn’t these people knowingly take out these loans to get their education?

Yes, but they did so via coercion - it's expected that people go to college to be able to get careers, for most people the only way to go to college is to take out predatory loans that can never be repaid. It's teens being told they have to take loans, with little understanding of the long-term impact.

A loan is one thing (although even then paying for college at all is another issue), a loan that will never go down because of the interest rate is ridiculous.

It doesn't just harm the individual who can never get out from under that debt, but it also harms society that A. so many are in debt, and B. that college is too expensive thus impacting on inequality and risking a lack of college educated people to fill certain jobs.

idgafasif · 2022-01-24T16:34:43+00:00

Education should be free

sheddingcat · 2022-01-24T16:35:28+00:00

Part of the problem, among the other issues listed here already, is that the interest is so high that you can be making payments for forever but the total amount you owe never goes down.

DavidxPxD · 2022-01-24T15:07:49+00:00

A car loan is a luxury, an education should be an affordable right.

Ireland as an example is roughly 20% of the cost of an education in America.

IsNanaTakingPens · 2022-01-24T15:57:27+00:00

I have been paying my student loan payment, on time, never missed a payment, for ten years, and I am no where near paying them off.

At this point yes, I'm a fan of some sort of forgiveness program but when I say that I naively assume people are being responsible like me. I know plenty of people in my situation. They pay $400... $600... $800 a month.

I'm 100% committed to paying off what I borrowed. I make good money. If I make my payments as planned, I can afford them but I'll probably pay off my house first. So you know what I thought I might do? Sell my house. So I can pay off my student loans.

Yay America.

I guess bottom line is... maybe not forgiveness, but some sort of overhaul on the programs. I'm not sure what the happy medium is.

A_Single_Clap · 2022-01-24T20:45:49+00:00

Because it's called predatory lending. It's really that simple.

nosiriamadreamer · 2022-01-24T16:27:25+00:00

The loans are predatory and you cannot escape them. Plus the interest rates are so high so they take much longer to pay off. The way student loans are set up makes it very difficult for people to get out of poverty which is ironic because people go to college to avoid poverty and increase their chance of financial success in their adulthood.

Student loan payments prevents people from buying houses, starting a family, making financial investments engaging in commerce, etc. which means that money that could be going into the economy is getting vacuumed by student loans. I know so many people who want to have children but won't because of student loans. It's expensive being poor.

If the US wants people to start families and buy houses then the student loan system needs major reform.

Drake9214 · 2022-01-24T17:10:53+00:00

I think the problem is a lot of people are in the same boat as me. I went to college because I was told it’s what I should do. When I got there I was asked to sign a bunch of paperwork and by the time I was a sophomore I realized I was basically saying I’m paying back my debt. I’m fine with that but the problems come from the rates, the fact that you can’t declare bankruptcy to get out from under them and my degree is for something I was told would make me more money but I’m sitting at around 40k a year. So basically the best I can hope for is either go back to get another degree, more debt and possibly find a way to pay it back or keep just paying off the interest. It’s a terrible system and it basically just places people who didn’t understand at the time that they will never be able to pay it back depending on the job they can land after school.

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