...It is unfortunate that many students and their parents will pinch pennies and borrow heavily to pay for a good college education. For many families obtaining a college degree is very important to them no matter how much debt they are put in. Applying for federal student loans is becoming the norm to cover the cost of obtaining a college education. Students have to borrow more and more money to cover the cost of higher college tuition rates. Currently, the interest rate for a Federal Stafford Subsidized and Unsubsidized student loans is at 3.4 percent, however, as of July 1, 2013, the interest rates on Federal Stafford student loans will significantly increase from 3.4 percent to 6.8 percent making it even more expensive for students to pay for college this fall. President Obama is working with Congress to keep the student loan interest rates down to 3.4 percent to keep it affordable for students (Lucas, 2012). So what is the problem? If Congress doubles the federal student loans interest rates, students will not be able to afford to pay for college. And college is sometimes not the only thing that students have to deal with. Student loans can put students with long-term burdens and stresses that in the future may affect their choice in jobs. Many students have to take care of other monthly bills like electricity, water, phone, rent, and possibly a mortgage. Nearly 10% of federal student loan borrowers failed to make a payment on their loans in 2010. Much of the increase...
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...billion in student loans in 2013. The government made more profit than Google did last year. This amount of money was only from student loans. Consequently, students have to decide between their loans or their diploma. Low-income students have trouble paying back student loans because colleges can be expensive and students are attacked by for-profit colleges and students are pressured about their type of education. Low-income students are attacked by for-profit colleges and have been forced to carry the burdens of debt while dealing with low-moderate incomes and the pressure of not pursuing a higher education. For-profit colleges are established or operated with the intention of making a profit. “...nearly one-fourth of students from for-profit colleges default on their loans within three years of leaving school, most without a degree” (Cauchon). For-profit colleges are unfair in their approach of handling money. These schools victimize students insensitive to background, race, or income levels and they do not distinguish their programs from public and independent schools. To summarize, for-profit colleges are becoming more and more demanding of students and are the main cause of student loan issues. Arnold Mitchem is the...
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...universities (About Harvard College). During the early 19th century, smaller colleges were founded to help young men transition from rural farms to urban occupations. Prestigious colleges at the time became more exclusive by concentrating on the children from wealthy families, ministers and a few others. Those prestigious colleges and universities are still very exclusive today mainly due to their expensive tuition. Students who attend these colleges are generally from wealthy families, have scholarships for high academic achievements or graduate with extremely high loan debts. In the early 20th century, junior colleges or now known as community colleges were created to prepare students for the final two years of college. Later in the 20th century state colleges were created to provide higher education at a lower tuition cost. Due to the rise of community and state colleges, students now have the opportunity for higher education, and college became part of the American dream for both students and their parents. Over the past, half a century students have been working diligently to prepare for college with the hopes of graduating with a degree that will provide them with the career of their dreams and to earn large incomes. Slowly, over time the cost of tuition in community colleges, state colleges, and prestigious universities have increased. So at what point do we say that the American dream has become too expensive? In the early 1990’s new types of...
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... Title: Student loan Debt Crisis Speaker: Markevia Lee Specific Purpose: To persuade the audience of their choice of taking out student loans. Thesis Statement: College is not something to put off until after you have graduated, students need to find ways to pay for college before they graduate. I. Introduction: Attention-getter: The increasing trend of college students graduating with significant more student loan debt than job prospects is both alarming and detrimental to the future growth of the nation. The cost of education and the widespread of federal student loans have created an education bubble to rival the housing boom that sparked the recession of 2007-2008. The more tuition rises, the more students need to take out loans. This problem is both current and urgent and must be acted upon now. Source: (http://www.usnews.com/news/articles/2014/11/13/average-student-loan-debt.) Establishment of Ethos: I have discovered there are ways student loan debt can be reduced by applying for scholarships and school grants. Preview: first, I will discuss recent graduates should be able to refinance their loans upon graduating, additionally, the government should intervene on behalf of students to encourage policies that lower college tuition, finally, I will you some examples of assisting students in the payment of college expenses. (Transition: “Let me start by showing the steps that should be taken to help recent graduates”) II. Body A. Student debts are exacerbated...
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... Sending a child to college; out of state versus in state High School Seniors and their parents often find that the school that the student has chosen may come with hidden surprises in the form of extremely high tuition rates. These rates make a local college a much more attractive and arguably, logical, choice. The extreme difference in the cost of attending a local college versus an out of state college is a factor that weighs on many parents and prospective students minds as they assess the cost and benefits of each option. Local colleges, or ones that are instate, come with a lower price tag for tuition than a out of state school. For example; Georgia Regents University tuition rates are approximately $2400 per semester for Georgia residents versus over $9000 for the nonresident rate at the same school. In addition to the lower tuition costs, a student may have the ability to live at home with parents saving even more money by eliminating the need for a dormitory room and meal plan. Further savings are realized by remaining close to family and thus having little or no travel associated with visits during breaks and summer vacations. Attending a local college allows for reduced or even no debt. Student loans are one of the biggest sources of debt among Americans coming out of High School. Beginning your adult life with this kind of debt can be a daunting prospect and causes many otherwise able and willing High School graduates to instead enter directly into the workforce...
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...many reasons why one to avoid taking on student loan debt, first of all we all know that any type of loan is required to repay to the lender later on. However, student loan debt can be very serious if one did not pay back to the lender. Having too much student loan debt can destroy person life financially and make things worse, and I also personally heard some people stories about their student loan debt. Some of them regretted about loan they took while they were in college. After 5 to 7 years repaying their student loan they haven’t pay off their loan yet. And there are several things happened to some of them such as: been denied from getting car loan or house loans. And because of these types of obstacles some people who graduated from college are having hard time with relationships, have kids...
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...Student debt is a serious issue in the United States, especially due to the fact that high unemployment has caused many students in higher education to question whether the debt they are piling on in pursuit of their degrees is worth it if they are still unable to get a job. Alan Collinge, Neal McCluskey, and Andrew Ross have all weighed in on the topic, but none of them has offered real, practical solutions that can assuage the burden that many students and families face. Tackling student debt will require multiple policy interventions, but it is imperative that action is taken. According to Collinge, the primary reason for exorbitant student debt is the removal of bankruptcy protections on student loans, which are no longer dischargeable since changes in bankruptcy law in 1998 and 2005 (federal student loans first underwent the change and private loans followed suit). Likewise, many unethical lenders have profited from defaults even as the nation as a whole has approximately $1 trillion in student debt. Collinge suggests the solution is to reinstitute dischargeable student loans so that students can be “freed” from their education debt if they become bankrupt. The problem with his suggestion is that does not actually solve the student debt problem but provides a way out once the situation is completely out of control and cannot be resolved in any other way. He also fails to mention that bankruptcy can significantly...
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...There are various higher education institutions that offer student loans as a pay method for students who cannot afford college. Ultimately, this leads the average student into thousands of dollars in debt and being forced to live in debt. Approximately two thirds of college students graduate with the burden of student loans. Most students can’t pay off their whole loan debt until their late forties. By paying for your education in cash, you will not have to worry about being in debt when you graduate, and you can go straight to the field of work you studied so hard and paid so much to be in. Currently, there is eighty-five billion dollars of student loan debts are past due, and thirty percent of students have missed a payment. Student loan debt becomes a routine part of your life, and you will have to realize that there might be a time where you will not always be able to make a payment by a specific deadline....
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...Pitch Refinanced Loans to Former Students (Some of Them)- Annamaria Andriotis- July 30, 2015 A growing number of student lenders are now refinancing the debt of certain graduates with high credit scores and high-paying jobs. Andriotis explains that five lenders have recently refinanced $5 billion in loans, and Golman Sachs Group Inc. estimates $200 billion of student loans could become eligible for refinancing. This strategy of the lenders is aimed at stealing customers from large banks and the federal government. The federal government currently makes up about 93% of outstanding student loan balances and charge the same interest rate regardless of income or credit score. While still a small portion of the student market, lending firms could potentially transform a huge part of the lending business. Refinancing through big banks has been difficult in the past and still is today. But recently, newer, more innovative startups are making it easier on student borrowers by refinancing private and federal loans. While helping students lower interest rates is definitely a good thing, some consumer advocates argue that under this approach, most of the debtors getting a break are the wealthy, not the ones who need it most. This is because the borrowers have incentive to “cherry pick” borrowers with lower credit risk. This new attention to the student-market isn’t surprising given the huge and growing market. With tuition prices still rising, the average student debt in this country...
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...In America, if a student wants to go to college they have to pay a sustainable amount to be able to do so. The cost of college has greatly increased in the past few decades. The high cost discourages minorities and poor students from attending college. Many students take out student loans to be able to afford college, but then struggle later in life with paying off those loans. Higher level jobs are beginning to require college education to even be considered and this can come troubling to those who are not able to afford college. In this essay I intend to explain the problems with the high costs of college, introduce a policy to fix the cost of college, and introduce the opposing side to my research. Congress should address the issue of the high cost of college because it is impacting our job market. A better educated society leads to a more educated nation, so it is in the best interest...
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...Strategies For Controlling Student Debt Jarett Lopez - 6385761 Dr. E. Bailey ENG 1100F October 5, 2011 Strategies for controlling student debt For those who attend college or university in Canada today, debt is inevitable. Many factors can contribute to this fact; the consistent rising of tuition costs, the marginal average income increase of middle-class families, perpetually rising interest rates, but most importantly, the lack of student debt relief knowledge. The Canadian Federation of Students has an ongoing debt clock which reflects the Canadian student loan debt of over 13.9 billion dollars, with an average debt per student upon graduation of approximately 25,000 dollars. This shouldn’t be surprising, knowing that since 1990, the average net income of middle-class families in Ontario has risen only 12.5 percent, all the while, tuition costs have risen from 2,500 dollars per year, to 6,500 dollars, an increase of an astounding 260 percent. This trend of rising tuition costs is consistent throughout the majority of Canadian provinces. Today’s Canadian post-secondary students are capable of controlling their debts, provided, they decrease their loans by minimizing their school fees and costs of living through being resourceful and staying informed. By being accepted to a post secondary institution, students have demonstrated that they have the intelligence and knowledge to succeed in their studies. Staying at university or college, however, takes...
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...2014 Student Loans Rising An Overview of Causes, Consequences, and Policy Options William Gale, Director, Retirement Security Project, The Brookings Institution, and Co-Director, Urban-Brookings Tax Policy Center Benjamin Harris, Deputy Director, Retirement Security, The Brookings Institution, and Fellow, Urban-Brookings Tax Policy Center Bryant Renaud, Research Assistant, Economic Studies, The Brookings Institution Katherine Rodihan, Claremont McKenna College The authors thank Elizabeth Akers, Matthew Chingos, Donald Marron, and Russ Whitehurst for helpful comments. The authors also acknowledge generous research support from the Ford Foundation. Introduction As of 2013, outstanding student loan balances in the US exceeded $1.2 trillion, more than any other type of household debt with the exception of mortgages.1 Following several years of rapid growth in outstanding loan volumes, student debt burdens have attracted increased attention in recent years. This policy brief reviews trends, issues, and policy options related to student loans. Federal student loans offer several important benefits. They help students attend institutions of higher education and help families cover or defer the costs of attendance. However, like other loans, student loans need to be repaid, which can strain borrowers’ income and affect other economic choices. From the outset, we note that isolating the impacts of student loan debt is a difficult exercise. Student loan debt represents debt undertaken...
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...of life should be a part of market and which should not. Governments can also use regulations to lessen risk, promote efficiently by correcting markets failures and externalities .Government regulations can enforce property rights, stimulates anticompetitive activities and increase competition. Government intervention can be appropriate and successful by eliminating monopoly, facilitating loans to students and business, establishing ethical rules to avoid corruption and so forth. But in contrary of that, public spending could negatively impact the economy, small business, others products and the consumers. Today our students are suffering some implications from their federal loans. “Student debt has nearly tripled since 2004, according to the Federal Reserve Bank of New York, and college students are borrowing larger amounts. And recent graduates are finding fewer job opportunities and lower or stagnant wages” (Pant, 2013). Therefore, there are many of controversial issues because some public investments and programs will not have efficacy and eminence results in our society Are Student Loans Destroying the Economy? No. But by trading cars for college (and homes for homework), some young people are investing in themselves rather than in the economy's biggest-ticket items DEREK...
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...We demand that North Carolina offer free college tuition to all undergraduate students attending a public university. Student loan debt is crushing our students short-term and long-term with the total amount of student loan debt; in America student debt was estimated to be about $1.3 trillion in 2015 (Should College Be Free? Pros, Cons, and Alternatives, 2017). Also, the debt to income ratio is ridiculous with the average salary of a college grad being $48,127 in 2014 while incurring $37, 172 worth of debt according to statistics of the 2016 college graduates (A Look at the Shocking Student Loan Debt Statistics of 2017, 2017). Lastly, with free tuition in North Carolina for college undergraduates the lower SES population will have opportunities...
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...5 Assignment: Student Loan Summary James Amaya Consequences of Borrowing Too Much Debt Approximately one third of your credit score is based on how much debt you have. A lower credit score means that you will have a difficult time getting approved for certain types of loans and credit cards. Being in debt can cause illness, sleeping difficulties, and relationship problems. The consequences of ignoring too much debt could eventually lead to personal bankruptcy. Some signs of trouble are: juggling bills to cover payments, being overlimit on credit cards, making only minimum payments on credit cards, using credit cards to pay normal living expenses, having a credit card cancelled for poor payment history, being repeatedly overdrawn at your bank, and being embarrassed to discuss your finances. Any of these things can cause you to have to modify your lifestyle by: selling assets, obtaining a part-time job to pay off bills, get a debt consolidation loan, or share housing to save money. These things can be difficult but they could save you from your last option, personal bankruptcy. Bankruptcy is never a good idea because the court costs and attorney fees alone can cost $1, 000 or more. Bankruptcy stays on your credit report for ten years. Bankruptcy may also affect your ability to obtain a home mortgage or other credit. My Plan for Repaying My Student Loans Before even making the decision to return to school I knew I would probably need student loans to pay my tuition...
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