Lost in DCAnd further more, I believe many of these very expensive
text books are written by the professors themselves, who probably make lots of
money because their students have to buy the books to take the class. Quite a
JiminSLC$51B interest ACCRUED on student loans. How much was
collected? How much principal was actually in default and will NEVER be
repaid?According to the CBO (not the most reliable, but the best
source I could find), the government expects to make $44B in 2013 in interest,
NOT the $51B you indicated. Once you factor in expected defaults, it drops to
$5.6B, roughly 1/10 of what you said. We can debate whether there is any
societal or economic benefit to subsidized student loans, but let’s be
honest in our arguments.Rates need to reflect risk. Student loan
delinquencies exceed 15% - even in the worst of the barney frank induced housing
crisis, delinquencies on mortgage never reached that height.If banks
were required to charge no more on student loans than what they paid for their
deposits, how would they pay for ANY of their costs?SCfan,Another factor leading to the high cost of college is the rapacious cost of
text books. All the major textbook publishers have the same parent – but
holder and the injustice department are doing nothing about THAT monopoly
– they want the young MORE dependent on dem largess.
I have a question about the "high cost" of education. Universities like
Harvard and such have billions in endowment money sitting around. Why then do
they increase the tuition cost? Many colleges in America could greatly reduce
the cost and still be operating at a profit. Yet the liberals who run these
institutions want govenment money to pay for it, not private money. I
wouldn't donate a penny to a rich college until they reduced the debt laden
cost of their over-rated educations.
What does interest matter, when many don't pay back their loans?
Last year the govt. made $51 billion on the interest paid on student loans.
Doesn't sound like a financial loss to me. There may be some people unable
to make payments because they cannot get a job, but I would not call that a
default since there is no way to escape the bondage of a student loan, the debt
will be collected through garnished wages and if it comes down to it,
withholding of social security payment.Low rates? The rate was 3.4%,
but due to inaction of congress the rate went to 6.8%. This sounds low, but
consider that a 30 year mortgage is still around 3 or 4%. Banks are loaned
money at less than 1%. Why not offer student loans at that rate?These folks strapped with student loan debt are the very same people that will
be contributing to social security to help keep that afloat. The sooner that
they can get their debt paid the sooner they can spend money in the economy,
buying houses, cars, etc... The country benefits from an educated populace.
Unlike the banks, Taxpayer are not bailing out folks with student loan debt.
Typical politicians eager to buy votes by pandering to some "victim
class."The government should NOT be in the loan business at all,
especially student loans.If they just do nothing (and Congress can
be really good about doing nothing!) they will slightly reduce our spending.
Then, they can devote time to working on cutting more billions until we have our
spending under control. Of course, that does not begin to pay off a cent of the
$17 trillion debt we have run up.If any kids learn anything in
college, it should be that our inability to live within our means is economic
disaster, and they will be the main ones to suffer.
Why are we allowing Congress to fight for lower rates on student loans that are
already losing money due to artificially low rates? That's what what we
should be asking. Despite the low rates already in place on current loans,
student loans have one of the highest rates of default. I think it's time
we made the rates realistic instead of enticing borrowers with untenable rates
that are picking the pockets of taxpayers.