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There are all kinds of Luxury apartments being built in College Station. I spoke with one of the developers a few months back and he said that students are gladly paying $500-750/mo for a single room because they are getting chin deep in debt every semester. Some are buying $40k cars and living the life of a $30k millionaire on college loan debt. Meanwhile, the university is sucking them dry with tuition and fees. It's great for the local economy and tax base for college station, but at some point, it's going to implode. Some day the kids will figure out that spending $100k for a 4 year degree at a state school with ZERO prospects for jobs is just stupid. The kids that went to trade school, even on debt, are laughing their asses off.Leave a comment:
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Government has no business being in the loan business. Student loan rates were 3-4% when financial institutions were competing with each other. This is the same direction our health insurance is headed.Leave a comment:
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I think the student loan bubble bursting was already on the way.
With a bad economy/job environment it's not if, it's when it will burst.
The rate only has marginal influence on the burst, economic conditions have the major effect.
Even with 8% rates on student loans, it's not a factor if jobs are available/attainble to be soaked up with college grads.
There is a loose correlation with interest rates and "Unemployment", but most people can see the disconnect between the unemployment rate and actual job numbers with respect to quality. College grads need quality jobs in sufficient quantity, not service industry jobs capping $10/hour.
Also, don't forget that you can't discharge student loans. It's with them until the end. So, a lender isn't necessarily forced to take a write-down.
Like the bank bailout, I would think that gov't would just step in and bailout the edu loan lenders to keep them afloat while waiting out for better economic conditions.
This is the just another example of problems that occur when the gov't gets into an industry, distorts the industry. I'm going to hate seeing how the gov't destroys the health care industry.Leave a comment:
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Christ, seven years of college down the drain. Might as well join the fucking Peace Corps.Leave a comment:
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What's the downside to a burst? Tuition rates fall by 500% overnight? Not a bad thing.Leave a comment:
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Meanwhile, grad school loans are fixed at 8.25% while the Fed Funds rate is practically fucking zero.Leave a comment:
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Student Loan bubble.
One step closer.
Students will face higher costs to repay their loans after graduation, after the plan's failure. Photograph: Mario Tama/Getty Images
Senate Democrats on Wednesday failed to restore lower interest rates on student loans, raising the prospect of significantly higher costs for undergraduates.
The White House-backed proposal from Democratic leaders would have left interest rates on subsidized Stafford loans at 3.4% for another year while lawmakers took up a comprehensive overhaul. The one-year stopgap measure failed to overcome a procedural hurdle as Republicans – and a handful of Democrats – urged colleagues to consider a plan now that would link interest rates to the financial markets and reduce Congress's role in setting students' borrowing rates.
Democrats failed to muster the 60 votes needed to advance the measure. The vote was 51-49, with no Republicans voting to move forward.
Without serious negotiations between the parties – and within a fractured Democratic caucus – students would face higher costs to repay their loans after graduation.
"Today our nation's students once again wait in vain for relief," said Senator Tom Udall, Democrat of New Mexico. "They expected more of us and I share their disappointment."
"Today, we failed. And our nation's students pay the cost of that failure," he added after the vote.
The failure to win a one-year approval – combined with little interest in such a deal in the Republican-led House – meant students would be borrowing money for fall courses at a rate leaders in both parties called unacceptable.
Immediately, lawmakers blamed the other party for the results.
"Today's vote is just another example of how out of touch Republicans in Congress are with the struggles of everyday American families," said Senator Patty Murray, a Washington state Democrat.
Representative John Kline, the Republican chairman of the House Education and the Workforce Committee, blamed Democrats.
"Right now, millions of students trying to prepare for college and apply for financial aid are facing higher interest rates – all because a cadre of Senate Democrats is completely unwilling to compromise," Kline said.
The rate increase does not affect many students right away; loan documents are generally signed just before students return to campus, and few students returned to school over the July 4 holiday. Existing loans are not affected.
However, absent congressional action in the coming weeks, the increase could spell an extra $2,600 for an average student returning to campus this fall, according to Congress' Joint Economic Committee.
I also found a link to ABC news, but I couldn't open it because of BS parental controls on work computers.
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