A Warning to the Next Generation of Student Debtors

[marmar]

from truthdig:



A Warning to the Next Generation of Student Debtors

Posted on Jul 10, 2012
By Emily Wilson


Explaining why she works with the United States Student Association in fighting for reform of the student lending industry, Carmen Berkley bursts into tears.

“I just don’t want anyone to have to go through what I have to go through,” she says, speaking of being hounded by lenders and having tens of thousands of dollars in debt she feels she can never repay.

Berkley is one of several borrowers interviewed in “Default: The Student Loan Documentary.” Another is Matt, who also tears up when he talks about his situation. A former student at New York University Film School, he says that with his debt reaching $200,000 he doesn’t think he will ever be financially able to marry and have children.

Aurora Meneghello, who made the short documentary with Serge Bakalian, said audiences respond to this moment in particular. “The human consequences—the amount of debt that never goes away, that destroys people’s credit and makes it impossible sometimes to have a family—that resonates a lot with people,” she said. “Basic human rights are taken away from you because you cannot pay back money you borrowed.” .................(more)

The complete piece is at: http://www.truthdig.com/arts_culture/item/a_warning_for_the_next_generation_of_student_debtors_20120710/

[liberal N proud]

1. K&R

[xchrom]

2. Du rec. Nt

[customerserviceguy]

3. $200K for film school?

What was he thinking?

If student loans had to go through half of the scrutiny that a small business loan did, maybe we wouldn't have so many indebted art history majors jerking coffee at Starbucks and wondering why their lives suck.

[Confusious]

4. Depends on what happened

200k for film school, sucker.

If the banks jerked him around and added fees and shit, it starts to pile on.

and we all know that couldn't happen.

the schools could have lied to him also. The for profit schools will suck you dry.

[customerserviceguy]

13. Anyone selling something

and that includes an "education" is likely to be lying to you. That means both the for-profit schools, as you point out, and taxpayer-supported institutions of higher education.

They sell the sizzle, but they cannot deliver the steak.

[Confusious]

14. I don't think so

State run institutions have reasonable rates (compared to private institutions), and you'll have an easier time finding a job.

For most fields, if you have a degree, you'll have an easier time and more choices about employment. The only people who don't think so are people who didn't go in the first place, or got a liberal arts degree, like women's studies or classical art.

I'm a non-traditional student, so I know from experience.

Friends of mine that had 4 year degrees picked up jobs in a couple of months while I was still scrounging for interviews.

[jberryhill]

5. Yeah! Stop lending to young people, for starters

A lot of these student loans are made to people who are simply too young to be making reasonable decisions in the first place.

The other big problem is that they make these loans to a lot of people who are not well educated.

[marmar]

6. But aren't they trying to get educated?

Are some people less worthy of education than others?

[jberryhill]

7. Quite obviously...

Student loans should only be made to older, educated people, who are less prone to making poor decisions.

They should also be secured loans, instead of unsecured loans. For example, qualifying applicants should be required to put up one of their houses as collateral. They wouldn't have to use their primary residence - one of their vacation homes would be okay.

[choie]

8. You ARE kidding, right?

With the cost of schools (even NYC state and city schools are no longer inexpensive) how is an 18 year-old kid supposed to afford education?

[jberryhill]

9. Borrow against his or her trust fund

Even if the 18 year old kid is on a fixed payment from his or her trust fund, it is still possible to assign those maintenance payments to a lender.

A quick visit to his or her estate attorney should be enough for almost any 18 year old worthy of an education to sort this out.

[choie]

10. Okay...

you Are kidding.

[jberryhill]

11. Of course I am

Borrowing against the trust fund would be foolish.

Instead, the family should consider funding a scholarship through the college, and then steering it to the student. That way, the entire amount is a deductible charitable donation which is not taxed to the recipient.

I was indeed just kidding about the trust fund.

[customerserviceguy]

12. I recognize your sarcasm

But let's face it, the only thing that you can borrow tens, or even hundreds of thousands of dollars for with zero collateral, with a low credit rating is a student loan.

Anyone who borrows even a quarter of what this guy signed on for (I'm allowing for the idea that fees, etc. quadrupled his loan, but I'd have to be shown that) to go to "film school" was simply asking to be disappointed with the results. We can't all be George Lucas or Stephen Spielberg.

[jberryhill]

15. The real scam...

...is in the way that "educational institutions" manage to basically harvest warm bodies through slick marketing for the purpose of qualifying them for student loans.