tagged w/ Student Loans
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To help new college graduates who are entering a rough job market with massive loans hanging over their heads, a new law has been passed.
The Income-Based Repayment program is designed for students with high loan amounts and low income (or no income, since May stats indicate 15.5% of 20-24 year-olds are unemployed).
The law will cap student loans based on one's gross income, and will be assessed each year based on the borrower's income and family size.
Full article at link...To help new college graduates who are entering a rough job market with massive loans... more
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islek
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2 years ago
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"If a lender makes a loan and the borrower repays it with interest, the lender profits. If the borrower can't repay, the lender loses out. It's simple finance, or so you doubtless think. Silly you.
For the student loan industry, the reality is the opposite: Lenders hope their borrowers default, because they actually make more money that way. Not only can they charge usurious interest, but they also get to bury defaulted borrowers with punishing penalties and fees. Moreover, student loans are the only loans for which bankruptcy protection is prohibited. Pile on collection fees from agencies assigned to chase and harass borrowers for what they owe, and repayments can inflate to several times the original balance."
More at link, referencing a book by Alan Michael Collinge about this subject! I'm invovled in an art project all about student loan debt that goes up in April and I think it's affecting many people today especially nowadays! Do you have student loan debt? How do you feel about it?"If a lender makes a loan and the borrower repays it with interest, the lender... more
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The BioTour crew attends the third presidential debate at Hofstra University and talks to students about what issues they are fighting for. Whether the environment or the economy, health care, student loans, or the war in Iraq, these are the issues our generation cares about in the fight for a better future. Listen up!The BioTour crew attends the third presidential debate at Hofstra University and talks... more
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Many of you have probably already seen the Facebook group created by Robert Applebaum, a lawyer from New York who believes that forgiving student loan debt for people making less than $150,000 per year would help boost the economy from "the bottom up."
"Instead of funneling billions, if not TRILLIONS of additional dollars to banks, financial institutions, insurance companies and other institutions of greed that are responsible for the current economic crisis, why not allow educated, hardworking, middle-class Americans to get something in return? After all, they're our tax dollars too!"
As someone who is myself drowning in student debt, I love this idea... but I don't have the economic or financial expertise needed to say whether or not this would actually work. Anyone want to weigh in?
Here's the FB group
http://tinyurl.com/cy2bvr
Here's a petition to sign
http://www.thepetitionsite.com/1/Real-Economic-Stimulus-Forgive-Student-LoansMany of you have probably already seen the Facebook group created by Robert Applebaum,... more
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When you have a lot of student loan debt you may be debating when to buy a home. If you try to buy a home at the same time that you're repaying your student loans you may be spending a significant amount of your income on repaying debt. Aggressively paying down student loan debt and paying a mortgage may leave you little money for other things in your life.
Question: I'm a full time student who's about to graduate this year. My plans are to hopefully begin the process of buying a home 6 months after I start working. How will my student loans affect my ability to qualify for a mortgage loan?
I expect to have $100,000 in student loans. Also I should have started repaying these loans at the same time I'm trying to qualify for a mortgage?
Answer: Like so many students, you're graduating with what amounts to a mortgage on your education. In fact, some people have home loans this big!
The monthly payment for your loans (referred to as the "debt service") will be subtracted from the total amount you can use to pay for your mortgage, real estate taxes, homeowners' insurance and total debt.
Lenders will commonly allow you to use up to 28 percent of your total gross monthly income for your mortgage, real estate taxes and homeowners' insurance payments. You will be able to spend up to 36 percent of your gross monthly income on your total debt. If you get an FHA loan (as opposed to a conventional loan), you'll be able to stretch those debt-to-income ratios a little higher.
It's possible that with your student loan monthly payments, you may not be able to afford to buy anything until you've paid down those loans significantly. If your income is high enough, you may be able to afford to buy even while you begin repayment.
I'd take the safe road: Don't begin to even look for a home until you know how much you'll be making, and what kind of a bite your debts will take out of that monthly income. And remember -- if you spend 43 percent of your gross monthly income on your mortgage, taxes, insurance and student loans, it can eat up as much as 65 percent of your take-home pay, leaving little for everything else in your life.
For more help calculating these costs, please read my book: 100 Questions Every First-Time Home Buyer Should Ask (3rd edition) to help you get started (it's available in most local libraries).When you have a lot of student loan debt you may be debating when to buy a home. If... more
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As a witness to the impending debt of higher education this comes as no surprise to me. The question is - what is the Nation going to do about it? How can continuing your education be more affordable? How do we move away from College Education as "service industry?" Perhaps we should take a look at the European system where students choose a focus of study early on and must pass a series of exams to continue to higher education, as opposed to the American system that is often criticized as hosting the token "party school" mentality and College as "babysitter" for those who aren't quite ready to go out into the "real world."
Thoughts on this from Graduates and those in school and looking at attending school?
From the article:
The rising cost of college — even before the recession — threatens to put higher education out of reach for most Americans, according to the biennial report from the National Center for Public Policy and Higher Education.
Over all, the report found, published college tuition and fees increased 439 percent from 1982 to 2007, adjusted for inflation, while median family income rose 147 percent. Student borrowing has more than doubled in the last decade, and students from lower-income families, on average, get smaller grants from the colleges they attend than students from more affluent families.
“If we go on this way for another 25 years, we won’t have an affordable system of higher education,” said Patrick M. Callan, president of the center, a nonpartisan organization that promotes access to higher education.
. . .
“When the economy is good, and state universities are somewhat better funded, we raise tuition as little as possible,” he said. “When the economy is bad, we raise tuition and sock it to families, when people can least afford it. That’s exactly the opposite of what we need.”
More at link. . .As a witness to the impending debt of higher education this comes as no surprise to... more
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The chancellor and governing Board of Trustees of the California State University system have continued to award hefty pay raises to top administrators this year even as the university moves toward capping student enrollment and slashing campus budgets.
Chancellor Charles Reed approved salary increases of up to 19 percent for nine vice presidents at four of CSU's 23 campuses earlier this year, and approved 11 new appointments of vice presidents at nine campuses at salaries of as high as $225,000.
A committee of the Board of Trustees reviewed those pay raises on Tuesday, endorsed a separate 10 percent salary raise for an interim vice chancellor who is receiving a permanent appointment and approved Reed's hiring of a vice chancellor for development for $240,000 a year - a job that had been vacant for about 5 1/2 years.
Such generosity for those at the top of the CSU pyramid has once again raised the eyebrows of its faculty members and staff.
"Paying managers and executives more at a time when everyone else is sacrificing is bad form," said Pat Gantt, president of the CSU Employees Union, which represents about 16,000 staff members. "It's like the executives at Enron taking bonuses while the company goes down ... .
More here:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/19/BAJ7147DGN.DTLThe chancellor and governing Board of Trustees of the California State University... more
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Students face mounting debt as economic crisis unravels.
Is Sallie Mae poised to join Fannie Mae on the list of economic disaster stories? The rising cost of a university education combined with a flat job market is making it difficult for students and their families to pay off college loans. In Bloomington, Indiana many of those waiting tables and cleaning dishes at the famed Mother Bear's Pizzeria are Indiana University students working their way through school. Catching the rare free moment between orders, workers describe the stress they are feeling in these rocky economic times. The recent credit crunch at the banks and the chaos on Wall Street has already added to their worries - undercutting family credit records, draining stock funds, and causing some students to question what the future will hold.
Students face mounting debt as economic crisis unravels.
Is Sallie Mae poised to... more
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Senator Obama talked about green jobs and the promise of a new energy economy. I posited that government’s bipartisan management of ethanol, a single energy product, has been so clownish and corrupt as to bring into question goverment’s ability to manage an entire energy economy, one that will presumably have lots of products, many of them more complex than corn-gas, and most of which presumably do not yet exist. I ask if this gives Miss Williams pause. It gives her none. Her response, which is expected, is that if only we get the right people into office, government will be good at doing things that government has never been good at doing before. She really, really seems to believe this when she says it. Sen. Obama seems to believe it, too. I ask Miss Williams how the government should go about bringing us into the clear bright day of green jobs. She answers: training. I ask her if she means that the government should begin training people for jobs that do not exist. She answers in the affirmative. She smiles.
The belief that having the Right People in office means that we can repeal reality is, of course, superstition. But there is nothing of the messiah-seeker in Miss Williams. She doesn’t make one think: drooling devotee. She makes one think: community organizer.
Organizing for what? The answer to that can be found here at the “I’m Voting For ...” site put together by Campus Progress. On this site, youngsters deliver short video sermonettes on the issue that matters most to them in the upcoming election, e.g. “I’m Voting For ... a New Foreign Policy,” “I’m Voting For ... College Affordability.” The website catalogues the invincible sense of entitlement that characterizes progressive politics, particularly among the young. One poor dear moans, Michelle Obama fashion, that he is going to have to borrow money to pay for law school. Another speaks very sadly of her late mother’s health-insurance travails. At some point, it became obvious to these young people that the chief administrative officer of the federal government is ex officio responsible for loaning them grad-school money and overseeing their moms’ health-insurance plans.Senator Obama talked about green jobs and the promise of a new energy economy. I... more
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MySpace has unveiled "MyAds," an advertising technology focused on small businesses and individuals rather than the huge brand advertisers that the News Corp.-owned social network is best known for. It's a platform in which an advertiser can allocate exactly how much to spend--between $25 ad $10,000--and target its audience using the HyperTargeting system that MySpace debuted just under a year ago.
With HyperTargeting, MySpace says that there are more than 1,100 specific ways to target an ad based on geography, demographics, interests, and other information sourced from public profile data. Advertisers can then keep tabs on performance through online analytics.
MyAds is currently restricted to MySpace in the U.S., where it has about 76 million members.
The "self-service" model is similar to what Facebook has done with its own ad platform--create an ad, choose how much to spend, select a target audience. But MySpace has a more obvious clientele in mind: bands. The MyAds homepage explicitly recommends the service for band promotion, something that gets very close to MySpace's roots as an independent music hub.
Promotional campaigns for bands, films, and other indie creative projects may have a more natural home on MySpace than Facebook, where the focus is less about media and more about communicationMySpace has unveiled "MyAds," an advertising technology focused on small... more
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bmltv
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3 years ago
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A school counselor directed La-Keya Williams to Spelman College, telling her she could grow and thrive there.
In two years at the historic black women’s college in Atlanta, Williams found it to be so. She was majoring in psychology, hoping to go home to Philadelphia as a school counselor who would encourage other students to live up to their potential.A school counselor directed La-Keya Williams to Spelman College, telling her she could... more
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bmltv
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3 years ago
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This is one of the best articles I have found so far looking at the impact of the current crisis on student loans and available monies for students either in school or looking to start school soon. As a student myself, I take this crisis very seriously, and I think we all should, students and non-students alike. Plus, keep in mind that this article is already a week old, and look what has happened in the last week :(
From the article:
"It was an afternoon in May when Bill Spiers got the call. As financial aid director at Florida's Tallahassee Community College, he'd been expecting it for some time now. "Loan crisis goes to college," CNN blared. "Credit crisis hits students," The Boston Globe ran.
"Bill?" It was the local Chase representative on the line: "I have some bad news for you."
For months, like financial aid administrators around the country, Spiers had braced himself for the fallout of the sub-prime mortgage crisis, waiting for it to impact the student loan industry. "There was almost this level of panic," Spiers remembers. "People thinking, 'What's going to happen to us?'"
Now he had the beginning of an answer. Chase was cutting off federal loans to his school, refusing to lend its students money. In the weeks to come, Wells Fargo, Key Bank, SunTrust, and Citibank would all follow suit. "
Read the whole story at the link.This is one of the best articles I have found so far looking at the impact of the... more
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NEW YORK
The attorney general of New York is negotiating settlements with eight student loan companies to reform deceptive practices in the industry. A particular focus is the marketing of products so they appear to be federal loans, an official said Friday.
"Some of the seals (used by lenders) looked very similar to those of the federal government," said Alex Detrick, a spokesman for the attorney general's office.
The distinction is important because federal loans have fixed interest rates that are often lower than private loans.
The student loan companies also misled consumers at times about the best loan options on the market, he said.
This group of direct-to-student lenders sends advertising material by mail or market to students online, but do not necessarily have a presence on campus. Students are sometimes offered iPods or gift cards as an incentive to sign up, Detrick said.
The attorney general's office is also preparing to sue student lender Goal Financial LLC for deceptive practices, Detrick said. Unlike the lenders currently negotiating settlements, Detrick said Goal Financial did not signal a willingness to reform its practices. He did not know how many, if any, of the companies would reach a settlement.
Calls to Goal Financial's headquarters in San Diego went to voicemail Friday and were not immediately returned. The company's attorney, Lewis Rose of Kelley Drye & Warren, did not return requests for comment.
Goal Financial was the sixth largest lender of consolidated student loans in the country in 2006, according to Student MarketMeasure, which tracks the student loan industry. Goal Financial made 111,426 loans worth $2.5 billion that year, according to the group.NEW YORK
The attorney general of New York is negotiating settlements with eight... more
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BuddyP
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added this
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3 years ago
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Back to school, kids, if you can scrape up the tuition. By some estimates as many as 200,000 college students may not find anyone willing to lend them money for school this year.
The 2008 Student Loan Blues Higher Education
Nicholas von Hoffman: Some 200,000 college students won't qualify for loans in September, and millions more will pay higher interest rates. Can they count on Obama to help them out?
Millions of others are going to have to jump through more hoops, pay higher interest rates and/or get their parents to co-sign their loans. This last expedient depends on the parents having a credit rating good enough to satisfy the money-lenders.
When students get loans this year, they will pay more for them. In at least some cases students are looking at rates of 23 percent. With those numbers a young person might be better off borrowing from the mafia.
Students shopping around trying to get themselves lower interest rates had best be careful. They can inadvertently get stung with higher rates as a result of trying to get lower ones.
In few other areas of consumer life are you at risk of being penalized for seeking out the best deal.... To quote a rate, lenders check an applicants credit history. And every time a shopper asks a lender for a rate quote, it can show up as another inquiry on a credit report. Lots of inquiries send the wrong signals to the formulas that create the popular FICO credit score. The lower the FICO score the higher the interest rate a student will have to pay for tuition money.
Cashing in on the kids is no small business. Last year it amounted to more than $17 billion. The interest on that is a lot of cabbage for private, government-subsidized loan companies, which explains why some college loan officers have taken bribes to steer students to favored lenders.
They have been lining up to screw unworldly 18-year-old freshmen and their parents who may not understand that there is a government student loan program at 6.8 percent interest--which is no bargain for someone about to start out in life, but better than getting the money from a guy with a baseball bat down on the docks. Since there is a cap on how much a student is allowed to borrow at the government rate, millions are also forced to sign up with the sharks.
No one can say how many students who take on these loans appreciate what a bad deal they have signed up for. Regardless of what bad luck may hit them in later life--unemployment, sickness, being run over by a beer truck--they must discharge that loan. There is no forgiveness. Unlike other debts, the law says not even bankruptcy will wipe out a student loan obligation.
It's a neat system. The colleges and universities run up tuition without stint or limit in a society in which you either go to college or live on the verge of poverty. You must go to school and incur the costs.
No tuition restraints were included in the just-enacted higher education law. But there are more costs than tuition. Higher education is better than the airlines at tacking on fees and special charges. And the publishers of textbooks costing more than $100 are exempt from prosecution under the Racketeer Influenced and Corrupt Organizations Act.
Young people have no representation powerful enough and well enough bankrolled to go up against the higher ed lobby. Barack Obama is their best hope.
He and the Democrats are counting on the youth vote to put them over the top this November. Lets hope that, if the young people win it for Obama, the new President will ignore the rich, academic liberal types who swarm about him and repay his youthful followers by getting them something approaching an even break.
Back to school, kids, if you can scrape up the tuition. By some estimates as many as... more
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Welcome to the real world grads, welcome to paying back all the money you borrowed.
If you took out loans for school you should take a look at this article (click the link). If you don't know that there are two types of students loans you should most definitely check out this article.
Welcome to the real world grads, welcome to paying back all the money you borrowed.... more
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"For a junkie, a "crisis" is being unable to get the drugs he craves. American higher education is just such a junkie - with the federal government acting as the enabler who gives him another fix, rather than pointing him toward rehab.
A college can only charge as much as students are willing and able to pay. In recent decades, though, federal (and some state) lawmakers have forked over ever-more money to student aid - enabling colleges to charge exorbitant prices.
Consider the per-pupil cost of tuition, fees, room and board, as tracked by the College Board. At private US four-year institutions, the "price" of college rose to an average of $30,367 for the 2006-07 school year - up 208 percent over the last two decades. At public four-year institutions, the rise was almost 216 percent."
College and the huge fees are just another method of getting young people in debt. This debt slavery for education is destroying our future."For a junkie, a "crisis" is being unable to get the drugs he craves.... more
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Instead of helping people achieve their dreams of using education to better their lives, Sallie Mae, America’s largest college student loan corporation, is apparently doing what it can to destroy those dreams through misrepresentation and manipulation. First on undisclosed nasty interest rates, now through credit agency reporting. They say only 1 million people affected. If you're one of the million you need to do something. Even if not directly affected you should be concerned about the future of a generation of graduates choking with debt. All for the profit of a few. And the packaging these loans to sell as securities for more profit. This will surely follow the path of the mortgage meltdown.Instead of helping people achieve their dreams of using education to better their... more
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Some of the nation's top student loan leaders say they will discontinue certain programs.
Bank of America and Citigroup's Student Loan Corp. arm said they would discontinue some student loans while Sallie Mae says it may stop issuing new federally backed loans altogether unless the government does something.Some of the nation's top student loan leaders say they will discontinue certain... more
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Student loans, credit cards, bank loans, borrowed cash... Young people of Britain! We are struggling with debt. Three-quarters of us owe an average of more than £9,000, and 12% owe more than £20,000, research has revealed. An one in five young people admit to spending more than they earn each month. Not good! But it gets worse...
"On average, young people spend twice as much on servicing their debt as they do on socialising, and more than three times as much as they pay into a pension. But more than half of under-35s are failing to pay into a pension - and among those who are, 24% are saving just £50 a month or less."
How are we ever going to afford retirement? Student loans, credit cards, bank loans, borrowed cash... Young people of Britain! We... more
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About 1/3 of current students will benefit from this new tuition program which seeks to make college more affordable for families earning less than 100,000, and room and board free for those who earn less than 60,000. I hope more universities start to do this by using their endowments and by fundraising instead of thinking to raise tuition costs on other students. For those of us with teens just now beginning to research schools it's good to know we may have more options to choose from.About 1/3 of current students will benefit from this new tuition program which seeks... more
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