Daily Archives: May 18, 2010

Student Loans: The Big Scam

Student loans started with the GI bill in World War II, and has expanded out of control.

Because of:  the colleges.

Tuition costs raced ahead of inflation by over half in the 80s, which looks like a bargain compared to the  four hundred per cent gap in the last ten years.

So, the way to keep attendance up, was, more student loans!

Of course, our friends the bankers were right there, not worried too much about lending standards, as the taxpayer was guaranteeing most of the money lent.

Today’s average college graduate owes over $60,000 in student loans.

The government estimates $605 billion in federal student loans out there, $47 billion already in default.

Private loans estimated at an additional $157 billion of student loans.

Keep tuition increases down to inflation, and that amount would decrease by about 90%.

Over half the amount lent, since 1965, is still out there, unpaid.

Supply and demand, the perceived cost of college is low, because the students are not paying as they go, and have been told how much more money they will make with that college degree.

It more than pays for itself!

No one ever crunches the numbers to check that out.

At some point, that college education is over-priced.

Not if you ask the colleges.

The Zen College Life website suggests, among other things, re-directing the bank bailout money to pay off the outstanding student loan debt.

Well, it would be a better use of the money.

But, once again, people who were frugal and paid their own way, would get screwed.

The government being the one who makes the rules, and the one the student loans are mainly owed to, they are not dischargeable in bankruptcy, unless you sue and prove in the bankruptcy court that it would be an undue hardship for you to have to repay them.

There is a better chance at relief if you were totally scammed, and the college was a sham, or, the program they conned you into was bogus.

For other possible student loan remedies, click on the link.

Student Loans: The Big Scam

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