Forum Post: Student Loan Forgiveness Talking Point
Posted 13 years ago on Oct. 19, 2011, 11:21 a.m. EST by ParacelsusStirner
(42)
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Why is it someone can declare bankruptcy after blowing their money on a mercedes, cocaine, and hookers, but student loans are still in effect if one does so?
Student loans should not be exempt from bankruptcy filings.
In order to broaden its message to reflect the fact that they aren't just cheap and lazy, OWS should demand retroactive refunds for ALL Americans who took out student loans and repaid them in the past. College tuition and loans have always been usurious and unfair; college education is a basic right that ought to be free for anyone who can gain admission. When the Revolution comes, it must help everyone, not just recent college grads.
I agree that student loans should not be exempt from bankruptcy where the petitioner can show that every effort was made to find a job in their field and their college, the lender, and the government did nothing to ensure that employment in their field of study was available upon graduation. But to answer your question, banks want to guarantee payback when graduating students in past immediately filed for bankruptcy rather than attempt repayment. In other words, your parents beat you to the bankruptcy courts, the banks own Congress, and now you're paying for it.
What about those that used their student loans to go on vacation, housing, food and entertainment?
In my opinion student loans should be for books and classes exclusively, not food or housing.
How would you pay for housing then?
I went to dental school and it was pretty much a 60+ hour a week job. I had to use student loans to pay for housing, my bills, food, basically everything. It was not really an issue though because I had a plan in place to pay back the loans before I took them...
escort services are paid with credit cards very often, gtyper
lots of things that are unrecoverable can be put on credit cards...
Because creditors can come and take your mercedes and material wealth (hard to put cocaine/hookers on credit). These possessions can be liquidated to pay off a portion of your debt.
How does your student loan ever get paid off? Most people qualify for lofty amounts because they have no credit history and it's hard to deny them access.
Further, you'll retain your education and be able to make it work for you at some other point in time.
I didnt suggest students declare bankruptcy....it's soemthing to say to people who automatically reject the idea
Good point but here's the problem:
Bankruptcy spares the repossession of assets for a duration of non-payment (7 or 11 years). Since a college education cannot be repossessed, why would bankruptcy be required? It's going to screw your credit regardless of bankruptcy or outright non-payment with no other adverse affects.
We signed a contract with the US government that clearly defines the responsibility of repayment. Even though I'm an advocate and activist for financial policy changes, I don't see the point in "student loan debt forgiveness".
Given options to gain sufficient employ in the field of our studies, the point of debt burden ease would be moot. Therein is where the focus should be. Elimination of debt is only a treatment of a symptom. A change in financial policies can be a cure for the cause.
I completely agree with this. I have a lot of student loan debt, and although I wouldn't turn down debt forgiveness, I don't feel it is valid demand considering we all agreed to the terms of our debt when signing the promissory notes. However, I would like to see a reduction in the interest rates on these loans and the government turn consolidation back over to private consolidation firms. I'm currently paying 5.25% on my consolidation loan.
Thank you. With all the opposition I've been facing for the past few days, I was beginning to consider that I wasn't making any logical sense at all. :P
I totally agree with you regarding interest rates. I can't recall what rate I was at before I paid down but it took a lot more out of me than the initial loans, which is the point of implementing such rates.
Overall, it would just be nice to see people go straight toward the heart of this financial crisis rather than off on the tangent of loan debt. We may not be able to or, in my opinion, even be justified to seek student loan forgiveness but, if we can affect the system at its core, we may be able to ensure that our children get a decent, affordable education that doesn't require spending a great portion of their income on repayment schemes.
After all, it is an elitist ideology to charge for education in the first place. If a country that is so concerned with promoting intelligent citizens, education would be freely accessible by all who seek it.
You're assuming that the government is the sole provider of student loans. It isn't. Private financial institutions are providing non-secured student loans, usually with parent cosigners - They don't want you nor your parents to be able to write-off the debt in a bankruptcy. The bigger problem is inequality in the government's policy on "debt forgiveness." The government just bailed corporations on their intra-negotiated private "poison assets" with middle-income taxes and foreign loans, yet allows those same corporate entities a guarnatee on repayment of private student loan debt that cannot be repaid because of corporate and government irresponsibility to the American people.
Agreed, barring assumption. You're preaching to the choir and making complete sense of the issue.
We need to strike at the heart of this financial crisis, not get distracted by the symptoms of it... and, again, you've hit it right on. It's financial policies.