BOHICA.....here comes another bailout.
FROM THE WALL STREET JOURNAL:
http://online.wsj.com/article/SB10001424052702304450004577279662086752488.html
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Here’s how New York Fed economists describe them: “Of the 37 million borrowers who have outstanding student loan balances as of third-quarter 2011, 14.4 percent, or about 5.4 million borrowers, have at least one past due student loan account.” That adds up to past-due balances of about $85 billion, or roughly 10% of total student loans, which is about the same past-due rate for other types of household debt such as mortgages, credit cards and auto loans.
Not bad, taxpayers might conclude, considering the government is handing out student loans regardless of credit history or ability to repay. But the researchers dug deeper.
“Does this mean that the prospects for student loan delinquencies are similar to those for the household debt in general, and thus no special attention is warranted?” asks the New York Fed. “Unfortunately, this is not the case—some special accounting used for student loans, not applicable to other types of consumer debt, makes it likely that the delinquency rates for student loans are understated.”
Are they ever. After correcting for this “special accounting,” says the Fed study, “We find that 27 percent of the borrowers have past due balances, while the adjusted proportion of outstanding student loan balances that is delinquent is 21 percent—much higher than the unadjusted rates of 14.4 percent and 10 percent, respectively.”
THE CFPB puts out a blog that supports the Occupoopers’ position (student loan bailout). I’m shocked! /sarc
When I went to college you either went on the GI bill, WW2 & Korea, or you worked to pay for it.
If you can’t pay for it don’t borrow the money!!!
Leave the law as is where you can’t wipe out the debt with bankruptcy!!
Push easy money into housing loans and you get a real-estate bubble.
Push easy money into college loans and you get a college expense bubble.
Push easy money into healthcare and you get a medicare expense bubble.
The goverment can’t resist, and the voters who elect them will never learn. We must forever banish the federal government from the free market.
There are several ironies in this proposed bail out for student loans:
* Most of those taking out student loans are middle class or upper class, since the poor got federal grants or scholarships. Now the poor or less educated get to bail out middle class college educated people.
* The government has been increasingly tying federal service to student loan forgiveness. Shall we see a broad “forgiveness” of this unbankruptable debt in return for virtual federal slavery?
* Student loan forgiveness means loans for education will dry up for future students.
I had an athletic scholarship, a campus job and I still had to borrow money. I will say I paid it all back tho. Probably puts me in a minority.
Student loans were designed for only one purpose...and that was not to help students to go to college who couldn’t afford it.
Listen carefully...it was to guarantee unlimited income for the colleges...period! Nothing more.
IMHO.....the student loan thingy is right up there with the mortgage fraud mess.....and while nobody forced anybody to sign any papers, the product being sold and the potential returns were conveniently obfuscated.
The student loan thingy is morally worse as the government has colluded to prevent discharge In bankruptcy, thereby creating an indentured servant class that has not been seen in this country since the 17th and 18th centuries.
Note also that the entire debt is forgiven if they are employed in the government or a secular non-profit for 10 years, and make all their payments, thus ensuring the gov. will be full of college educated liberals, as about 90% of colleges are.