LogFAQs > #923798471

Dynalo posted...

wolfy42 posted...

The loan situation though is pretty simple, currently higher learning in the US is a for profit situation. Much of the "loan debt" in fact is not actually even based on initial costs for the loans, but based also on interest since the loans were accrued, defaults penalties etc.

As long as they are still loans that you are expected to pay back, they really can't be interest free though. Otherwise whoever the lender is would be losing money every year on every loan. If it takes you 10 years to pay off a loan, that's 10 years of inflation that devalued the money you were given.

Now, the easiest way to do this, assuming no subsidies, would be to tie the interest rate to inflation. No private lender would be willing to do that, but the government could provide loans and not lose their backs on it, while providing at least some relief to the students.

But that's assuming you don't just completely overhaul the entire system, because providing low interest loans would be akin to putting a band-aid on a bullet wound at this point. Sure, it might help a little, but there's larger underlying problems here.

I mean, the government actually prints/creates the money in the first place, and I guess having interest equal to inflation would at least be better then it currently is. You can get 0 interest loans/credit cards etc though in many ways as well. The biggest problem was the hugely inflated costs for going to college in the first place, and this needs to be fixed.

Again, this is something that was already done, and at least the interest from the loans directly made a profit for the government off the students. The schools themselves made the biggest (huge) profit though, which you can't get back.

Absolutely nobody deserves to be in 30k+ debt because they went to college and now can't even get a decent job with the degree (when they were pretty much assured they were going to get a great job with...which is why they went in the first place).

To toss on an insane 7% interest rate (double the rate on homes for instance and many other loans), is just evil.

There are ways to fix the problem, besides just a blanket forgiveness, but something should be done to balance the scales a bit. I get people are like (your mistake, pay for it) but it was based on misleading information. I saw one plan that based the amount forgiven based on your yearly income.

That might be the best solution yet, since you have finished your degree (graduated) take the average yearly income and determine how much of the loan is forgiven based on that.

If your average yearly income is under 30k forgive up to 50k in loans (and all interest), if it's 30-50k forgive up to 40k and all interest, if it's 50-80k forgive 10k (and all interest) and no forgiveness if your average income is over 80k.

That would only help those who are desperate and were not able to find jobs that paid enough to get out of debt with.
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