Posted on 06/15/2012 9:18:10 AM PDT by C19fan
A few months after he buried his son, Francisco Reynoso began getting notices in the mail. Then the debt collectors came calling.
"They would say, 'We don't care what happened with your son, you have to pay us,'" recalled Reynoso, a gardener from Palmdale, Calif. Reynoso's son, Freddy, had been the pride of his family and the first to go to college. In 2005, after Freddy was accepted to Boston's Berklee College of Music, his father co-signed on his hefty private student loans, making him fully liable should Freddy be unwilling or unable to repay them. It was no small decision for a man who made just over $21,000 in 2011, according to his tax returns.
(Excerpt) Read more at propublica.org ...
Didn't we try this many years ago with the kiddies basically declaring bk right after school ended when they typically had no assets?
A whole department at Berklee got fired because they drank Dewer’s Scotch all day. The head of the department had an ice machine in his office. Then they would go over to TC’s (Boston’s #1 Dive bar). Play Golden Tee Golf. Drink more Dewer’s and go back for their afternoon classes.
A whole department at Berklee got fired because they drank Dewer’s Scotch all day. The head of the department had an ice machine in his office. Then they would go over to TC’s (Boston’s #1 Dive bar). Play Golden Tee Golf. Drink more Dewer’s and go back for their afternoon classes.
As a matter of law, the lender has the right to ask a co-signer for rePayment. But as a matter of decency, this should be handled with kid gloves first to try to make an arrangement.
Only if the surviving co-signer refuses to even try to cooperate should you treat him as a deadbeat.
*ahem* I think Eric Holder would not be supportive of that plan.
;)
College education COULD be free or at least “free” as in freedom. The Dept of Education simply creates a public service web page that provides downloadable educational content. Start at pre-K and then add content all the way up through PhD course. That allows for the free distribution of knowledge.
The other half of the equation is the testing and certification that the individual has learned the knowledge required. Again, a model already exists for this requirement. That is the testing centers / services like the ones used in IT. Other similar testing centers can do the same. Need to show that you know how to draw blood. Go to the “Prometric Health Testing labs”. To maintain certifications, periodic retesting will be required.
The federal government can then select which testing organizations they trust and accept their certifications on federal job applications.
I would predict that the cost would drop significantly. I would say that if you tested each and every course, $100 - 150 per course, then most Associates would cost between $2,000 and $3,000. Bachelors would be 4 to 6 thousand.
No longer would you need to GO to college. You could stay home, process the material as fast or as slow as you needed, and when you were ready, go take the certification test.
This would also have the long term effect of destroying the education monopoly and the teachers unions. Teaching would no longer be a specialty.
The government is the lender for all student loans, now. This was part of the Obamacare act, so Obamacare could, 'pay for itself' on paper. In reality, government doesn't care if you can't pay a loan back, (see Solyndra).
Pat Metheny taught there, at the age of 19.
Berklee is a phenomenal place. I was there the night Louis Belson and Buddy Rich gave a concert - dueling drums. The place was filled with Berklee students and it was an electric experience - like no other.
I co-signed for one loan in my life and regretted it.
Now when someone asks me to cosign something for them, my reply is simple:
“If the bank, who has looked at your credit, has decided you are unworthy of a loan, why should I find you credit-worthy?”
Do that, and lenders will stop paying for degrees that aren’t likely to produce a paycheck.
That, in turn, will cut the cost of college to something closer to a level that can be “pay as you go”.
Precisely. Get the damn federal government out of the business completely. Even then, there will always be lenders available to finance somebody's degree in ethnic studies or whatever useless degree, but they will charge a rate commensurate with the risk.
My former state (North Dakota) had a state owned bank to finance student loans, among other things. They lent very prudently, including amount limits, students being required to put some of their own money on the line and show steady progress toward a degree, etc. Their default rate was very, very low.
Hillsdale College in Michigan goes a step further and won't allow any of their kids to get government loans. They have their own set of approved lenders. Since it is a conservative college with a reputation of turning out useful graduates, the default rate is very, very low.
I'm aware of at least three other conservative institutions (Liberty University, Grove City College, Brigham Young University) which have set up alternative loan pools in similar fashion to Hillsdale. Government loans are not yet prohibited, but they are working in that direction. Again, because all three turn out generally useful graduates, default risk is low.
When I was a pup, there was no shame in taking six or seven years to graduate because it was mostly pay as you go. The work experience which you picked up along the way actually enhanced your employability at graduation.
I know. He was there on the faculty when I was there. Gary Burton brought him in.
Pat was on tour with Gary a few years ago, but I missed out on it. “Passengers” with Eberhard Weber is one of my favorites. You could just hear Pat was on the verge of greatness on that album.
They would not misunderstand my reply in such a case.
Oh...and co-signing anything for anyone?
Learned that lesson long ago....fortunately it was only a few months rent...
What kind of fool borrows $160.000 for a degree in music? WHat hope did anyone have that this kid could ever earn enough to pay it back? Most people trying to make a living in music are starving.
What kind of fool LOANS a kid $160,000 so he can get a degree in a subject where he has no hope of earning enough money to pay it back?
Thank you, I’ll make my own rules and decisions regarding co-signing.
And they have a powerful reason to do so. The FedGov has tried to get its regulatory fingers into Hillsdale's pants on the pretext that its students are being subsidized through loans and other aid from the FedGov.
So Hillsdale rejects such subsidies to their students.
The capitalist system is wonderful for what it is supposed to do. There are things in life, however, that it doesn't cover. Music is one of them.
But it is not necessary for you to understand this. Go to work, make your money, and if you feel like it you can go to a concert and smash cheetos into your mouth while you guzzle beer and belch, while patting the roll of cash in your pocket and laughing at the stupid musicians who will never achieve your level of financial freedom.
Just do it away from the rest of the audience.
That's why they are ahead of the curve on the alternative financing. But it still wouldn't work without their reputation of turning out useful graduates with a low risk of loan default.
Their relatively small size also worked to their advantage. Of the at least three colleges that I listed which are set to follow them, I believe GCC is the furthest along and no coincidence that they have the next smallest student body.
SalliMae's entire loan portfolio needs to be broken up and sold to commercial banks at discounted rates. Yeah, the taxpayers will lose a little money. But they will lose a lot more if this Godzilla is allowed to keep growing.
No habla inglish....
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