Posted on 06/19/2007 4:29:34 PM PDT by Saint X
What Now -- Student Lenders Stealing Food from Borrowers?
'World News Sunday' pushes victimization theme, using extreme scenario and leading Democrat to blame lenders.
By Jeff Poor Business & Media Institute
The latest slant on student loans: private lenders essentially steal food off borrowers tables.
A woman who earns only $200 more a month than she pays toward her student loan is not a representative example, yet its the one ABC chose for its June 17 report.
World News used the example of Nicole Gibson, a graphic designer making $1,400 a month, who pays $1,200 a month toward her student loans.
Ive got to sacrifice food on my table and I dont think thats a fair option, said Gibson.
ABC Correspondent Gigi Stone didnt explore whether Gibson could renegotiate her payment plan with her lender, or whether she had looked into loan consolidation or any options that could lower her payments. The report also left out key facts such as where Gibson lived, how much debt she had, and what type of loan or loans she had.
Gibson chose to get her degree from the Rochester Institute of Technology, but ABCs Stone didnt mention tuition there costs nearly $25,000 a year. The average annual cost of undergraduate tuition is much less $5,836, according to an October 2006 U.S. News and World Report. But the story showed Gibson saying her payment wasnt fair, instead of acknowledging it was a result of choices she made.
The segment provided further proof of media support for liberal New York Attorney General Andrew Cuomos crusade against the student loan industry.
(Excerpt) Read more at businessandmedia.org ...
a graphic designer making $1,400 a month
LOL.....ABC should have gotten a degreed basketweaver to exploit :)
$1400 a month, she might as well work at Wal Mart. This along with the $1200/month student loan; something doesn’t smell right about this story..
I can't imagine getting a degree that costs $25K a year so that I could work for $1400 a month.
My daughter in law goes to school with a girl who has 200k in student loans and she hasn’t finished her undergraduate work yet.
The entire student loan program is poorly handled. I don’t understand how the girl came up with 200k in student loan debt but in this case it’s a fact.
Well I’m guessing she borrowed a little more than her tuition costs each year, never held a job, and had no idea she would actually have to work it off later.
Its not all that uncommon for undergraduates to rack up $130,000 in loans at expensive private schools. I have no idea why anyone would want to do so, but to live it up like that in a fancy college and then complain afterward about the opportunity most people will never get?
The incredible part is how our culture coddles these spoiled kids when the bill comes do.
Lest anyone think this is outrageous, these are quite normal college costs, and pretty typical of 4 year full time degree granting institutions. Think state universities are a whole lot cheaper. Look at University of California, University of Michigan, University of Virginia, UNC, etc. You might knock $10,000 off that if you are in state.
A 4 year degree costs $120K - $200K these days. The mortgage on that is $1200 per month.
The problem is that the Federal government inflates costs by making the money available to pay for it. The market goes for it, and you have to pay market price or do without, and you are on the horns of dilemma if you are chasing the American dream.
Its not handled much differently than any other loan business. If anything, even in private loans the terms are more favorable to the borrower than in non-mortgage non-educational loans.
I also know a friend of a friend who works at McDonalds and put her entire college bill on her credit card. Now she has three associate degrees and still works at McDonalds, with a $30,000 debt at 18% interest.
I can’t really blame the credit card company for that. When people use financial services, they need to be aware. Its like any other purchase and I hate when the dumb ones try to ruin it for everyone who knows how to purchase the product effectively.
It SHOULD be a great investment in one’s future. If it isn’t, I think that’s a personal planning problem.
I may have had an advantage in that my parents forced me to save for and pay for the first semester of college myself before they helped or co-signed a student loan, it really taught me to think about the return on investment for college. Too many college students think that it is simply a continuation of high school that someone else will pay for, not on the platform for the rest of their lives.
Rochester is a Direct Loan school so the only other loans that she could have taken out are called alternative loans. These are loans made by banks to credit worthy individuals for educational expenses. Students can rack up quite the bill if Mommy and Daddy co-sign on an alternative loan. So unless she had an alternative loan, the big, bad government is the one that lent her the money, not a private bank.
ABC should stick to evaluating side impacts on vans, something they are well qualified to do.
I don't know where you have been, but college is not fancy - not even the best of them - and RIT is certainly not one of those. In fact, it is pretty normal to go to 4 year colleges, and 4 year colleges charge these kinds of fees, large or small, good or bad, public or private.
Thanks. And college costs $40,000 per year because the big bad government makes the funds available.
Where have I been? I just got out of college. It cost me about $2,000 a year for tuition and $1,000 for books. I’ll be starting my MBA in the fall and it will cost about twice that.
I saved for some of my college, worked some, and borrowed some. But private school tuition room and board when I went was $4500 per year or so. Now it is a decimal place higher. $18,000 did not buy a house. $200,000 does.
The aggregate loan limits are $23,000 for dependent undergraduates. The maximum loan limit for graduate and professional students is $65,500.
In addition to subsidized loans, independent students or dependent students whose parents do not qualify for a PLUS Loan, can borrow up to:
$6,625 - 1st year undergraduates (2625 subsidized + 4000 unsubsidized)
$7,500 - 2nd year undergraduates (3500 subsidized + 4000 unsubsidized)
$10,500 - 3rd and 4th year undergraduates (5500 subsidized + 5000 unsubsidized)
The aggregate loan limits are $46,000 for independent undergraduates (only $23,000 of this amount may be in subsidized loans).
The aggregate loan limits are $138,500 for graduate and professional students (only $65,500 of this amount may be in subsidized loans).
Now alternative loans are based off of creditworthiness. So if you've got good credit, you can borrow a bunch.
At least maybe she'll be thin.
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