Biden's student loan forgiveness

[Edge-]

The issue is that student loans don't have an asset to foreclose on for the lessee to recapture their investment. What value does the product the of the student loan have? Nothing since a diploma csnt be resold. If you stop paying for your car, the bank can take the car. Stop paying for the house? They can take the house. In bankruptcy, what would the bank be able to take? A piece of worthless paper?

Is this an argument against bankruptcy writ-large, then? I mean, you start a business and it crashes and what does the bank have left? Maybe some inventory and assets to liquidate?

That's not how bankruptcy works at all, my dude.

You would just be making the interest rate exorbitantly expensive since there would be an incredible risk in giving out student loans without some form of protection against just declaring bankruptcy at graduation since they have nothing to really lose.

Except their credit score, which will take them decades to rebuild. Do people not realize how important credit scores are in the modern world? This dystopian tool created a few decades ago that determines our financial capabilities and is based on things like, "How much debt are you going into, because going into debt and making regular payments makes your score go up! You're not in debt and just have small regular expenses? Well screw you, your score goes down."?

If you know anyone that's gone through bankruptcy, I highly recommend you chat with them about it if they're willing to talk about it. It's not a fun, easy, fast, or painless process.

[Witchblade77]

Is this an argument against bankruptcy writ-large, then? I mean, you start a business and it crashes and what does the bank have left? Maybe some inventory and assets to liquidate?

That's not how bankruptcy works at all, my dude.



Except their credit score, which will take them decades to rebuild. Do people not realize how important credit scores are in the modern world? This dystopian tool created a few decades ago that determines our financial capabilities and is based on things like, "How much debt are you going into, because going into debt and making regular payments makes your score go up! You're not in debt and just have small regular expenses? Well screw you, your score goes down."?

If you know anyone that's gone through bankruptcy, I highly recommend you chat with them about it if they're willing to talk about it. It's not a fun, easy, fast, or painless process.

oh god so much this.

I literally keep credit cards they have one bill set on autopay (phone bill for one, car insurance for another - SO also has similar setup where he basically buys gas with credit to keep it active) with full balance payment also on autopay for the sole purpose of have an open credit card that both has active debt on and and shows that I pay that debt down on time - specifically to keep my credit score up. the system is incredibly counter intuitive, but its absolutely vital to understand it if you are not a trust fund baby with money waiting for you no matter how much you screw up.

I too used to think that credit score was useless in my youth. it took SO and me almost a decade to rebuild out credit score enough to qualify for a mortgage. when we were still renting, multiple places were unavailable to us, not becasue of our dogs, but because we were still in process of rebuilding credit score so it was still relatively low at a time and yes landlords check credit scores nowadays. we had to make giant security deposit to our utility companies that they held for a year, until we have proven our ability to pay on time. our first credit card that we started rebuilding with - was a secured one, because its the only kind we could get. jobs also check your credit score, especially the kind where you might be handling expensive equipment etc.

bad credit score in this country means drastic reduction of opportunities. back then when SO and I after all those bad choices out of ignorance - were trying to figure out how to deal with our debt, we did consider bankruptcy. and the reason we didn't go for it and went through painstaking process of repayment, consolidation etc etc etc instead (and it was NOT easy, we had some very lean years there with budget stretched as tightly as a drum) - was bankruptcy is so... much... worse. and takes forever to remove from your credit. and as a ping for people checking your credit? it closes far too many doors.

for a regular person who is actualy genuinely struggling? bankruptcy is not just last resort, its a "you are so desperate there are absolutely positively NO other options left at all" resort.

but anyways to bring it back to loans, tax provision that turns forgiven loans into a taxable income - is quite frankly bullshit. and I'm glad that its not going to be a thing for the next 5 years at least.

[Zan15]

The issue is that student loans don't have an asset to foreclose on for the lessee to recapture their investment. What value does the product the of the student loan have? Nothing since a diploma csnt be resold. If you stop paying for your car, the bank can take the car. Stop paying for the house? They can take the house. In bankruptcy, what would the bank be able to take? A piece of worthless paper?

You would just be making the interest rate exorbitantly expensive since there would be an incredible risk in giving out student loans without some form of protection against just declaring bankruptcy at graduation since they have nothing to really lose.

Yah those corporations that have 22 billion in debt and 3 billion in assets make it so difficult to get low interest loans as corporations......oh wait....

If you owe 20,000 on your credit card and have no assets then why are you able to have those dismissed under bankruptcy law?

Sure you would have increased risk, but no one said open up bankruptcy to everyone and anyone for any reason.

[cubby]

The issue is that student loans don't have an asset to foreclose on for the lessee to recapture their investment. What value does the product the of the student loan have? Nothing since a diploma csnt be resold. If you stop paying for your car, the bank can take the car. Stop paying for the house? They can take the house. In bankruptcy, what would the bank be able to take? A piece of worthless paper?

You would just be making the interest rate exorbitantly expensive since there would be an incredible risk in giving out student loans without some form of protection against just declaring bankruptcy at graduation since they have nothing to really lose.

Then why can immense amounts of credit card debt, with no assets to show or seize, be easily and readily bankrupted?

If education loans are so risky, they should stop giving them out so quickly.

[GreenJesus]

Then why can immense amounts of credit card debt, with no assets to show or seize, be easily and readily bankrupted?

If education loans are so risky, they should stop giving them out so quickly.

Credit card interest rates are like 18%. Student loans are kept very low.

[Kathandira]

Then why can immense amounts of credit card debt, with no assets to show or seize, be easily and readily bankrupted?

If education loans are so risky, they should stop giving them out so quickly.

Indeed, with all that's been said, now put yourself in the shoes of an 18 year old. Fresh outta high school, likely has had a part time job or two over the passed two years.

They show up at a school, and want to apply. They get accepted and need to take out a loan. They can go to a bank, but will likely get rejected as they have no credit history at all. Or they can take out a federal loan, which will accept just about anyone, but will tack on an insane interest rate to make sure they make money on it.

They do not care what courses you are taking, or your performance history through out your school history. They want your money. And it is very predatory as the least well off end up with the highest interest rates. And of course, the higher the loan, the higher the interest payments, which means your monthly rate is higher. AND if you don't look at the fine print, you may not know how the interest is calculated. Being 18 years old and have little to no experience with contracts or real world finances, you can suckered into insane interest payments.

20k loan over 10 years, $2,000 per year before interest.
40k loan over 10 years, $4,000 per year before interest.
etc.

Add the interest which could be around 10% or higher if you have no credit history.

- - - Updated - - -

Credit card interest rates are like 18%. Student loans are kept very low.

Not always the truth.

[Edge-]

Credit card interest rates are like 18%. Student loans are kept very low.

Depends on the card, mine is MUCH lower though I've never actually needed to pay it.

That has nothing to do with the fact that it undercuts your argument though. Someone with no assets gets credit cards and racks up $50K in debt, there are no assets as collateral. That's just written off and paid back by taxpayers as the individual files for bankruptcy.

[Zan15]

Credit card interest rates are like 18%. Student loans are kept very low.

mine is 8.9%

I could also open a 0% credit card tomorrow for 18 months.

my daughter somehow has a 740 credit score at 19.

i bet she could too

[cubby]

Credit card interest rates are like 18%. Student loans are kept very low.

That doesn't address the issue, at all. And not all CC interest rates are that high.

[Felya]

Credit card interest rates are like 18%. Student loans are kept very low.

Ha! Your credit is shit...

- - - Updated - - -

And not all CC interest rates are that high.

They are for some... likely those with issues paying their student loan... buzzinga?

[GreenJesus]

Ha! Your credit is shit...

- - - Updated - - -



They are for some... likely those with issues paying their student loan... buzzinga?

My credit is 799. I never pay interest on my credit card since I pay it off every month. I'm not retarded.

Just a quick google.

https://wallethub.com/edu/cc/credit-...st-rates/52541

The average credit card interest rate is 17.87% for new offers and 14.58% for existing accounts, according to WalletHub’s Credit Card Landscape Report.

https://www.nerdwallet.com/article/l...20is%20federal.

The average student loan interest rate is 5.8% among all households with student debt, according to a 2017 report by New America, a nonprofit, nonpartisan think tank. That includes both federal and private student loans — about 90% of all student debt is federal.

[cubby]

My credit is 799. I never pay interest on my credit card since I pay it off every month. I'm not retarded.

Just a quick google.

https://wallethub.com/edu/cc/credit-...st-rates/52541

https://www.nerdwallet.com/article/l...20is%20federal.

The damned interest rates are secondary.

We have all noticed you're ignoring the issue of bankruptcy fairness - how it is somehow ok to bankrupt out of credit card debt, with nothing returned to the creditor, but somehow NOT ok to bankrupt student loan debt, with nothing returned to the creditor. In bankruptcy law you can even keep some of the items you buy with the credit card debt, to say nothing of spending all that credit card money on trips and nontangible items, then just sloughing it off in BK court.

Square that away for us, please.

[Felya]

My credit is 799. I never pay interest on my credit card since I pay it off every month. I'm not retarded.

Just a quick google.

Oh, so... what you meant to say, is that average new credit card holders at 18%... while the average is actually 15%... meaning your credit is shit at 18%... as in... people who have issues paying student loans, would be the ones with 18% interest... they will be the ones bumping up the average for people who have sub 15% interest...

You just discovered that federal government already subsidizes student loans, by 10% on the average... or... let’s compare to current 30 year fixed mortgage interest? 3.125? You see a similarity between long term lending percentage with that of short term, like credit card? So... bazzinga?

- - - Updated - - -

The damned interest rates are secondary.

The only reason to compare long term lending like student loans, to short term, unplanned lending of a credit card, is to exaggerate the comparison. I’m 7 years in to my mortgage... if I wasn’t paying extra, on top of the monthly payment, I would be paying majority of interest, for 15 fucking years. Only after that, does the loan shift to paying more for your actual mortgage, instead of interest.

[Chairman Sheng-Ji Yang]

The problem I'm seeing with university grads, at least in my industry is that they have an insignificant amount of practical experience, even with their co-op programs, to be successful in their field. I work in manufacturing and the university graduates we take on in engineering roles are so lacking in their understanding of how to actually do their jobs properly because they aren't given the hands on training that college students get. Now, I'm a tradesman with accredited training for university engineering programs if I wanted to do that, and I can tell that these kids could use some of the hands on training that I've had to understand what it takes to actually manufacture things. I know a lot of people poopoo the value of colleges and trade schools, but I do think that the more application based learning has a lot more value in life than the theoretical heavy learning that Canadian universities tend to offer.

And do people really need 4 years? I'd be more inclined that a 4 year program should be offering at least a full years worth of either on the job learning as a co-op or doing practical training.

In Europe, we do our Bachelors in 3 years, and some Masters in 1 1/2. I'll admit I was always a bit perplexed as to why they'd need more years in the US. Nowadays, AFAIK in many countries mandatory internships are part of the program, and back in my days they were already a thing in the top engineering schools.

- - - Updated - - -

I know America has a different system from us for post-secondary education, but I think there's ways we should be structuring a lot of the technical fields like STEM to give students more hands on as part of their programs. In Canada a lot of programs allow for academic upgrading. For me, at the end of my apprenticeship, if I'm inclined to, I could go to university and do mechanical engineering and probably start in year two or three of the program, going in with more of the hands on experience having spent 3 years as an apprentice. For someone in my position, coming out of an engineering program with that hands on training, really is advantageous in terms of understanding what it takes to engineer things and what we are capable of making these days.

But here, college is trade school and a myriad of other programs. You can do college level engineering degree, business and a bunch of other programs that aren't exclusively catered towards a certain learning demographic. Some colleges offer programs that allow you to step into university after a couple of years through the accredited courses they offer. Our education system is kind of strange too, there's a disproportionate number of women to men in university, while the colleges are the opposite. I think a lot of that has to do with how men and women learn, and men often being more suited to hands on learning. I am an advocate of more young people pursuing college because not only is it more cost effective here, you get better preparation for the working world. People shouldn't be pressured to go to university here if they don't have the grades to succeed and do really well.

Apprenticeship does play a major role in my country, but we're kind of an oddball maybe : senior High School is not mandatory (compulsory education ending at 15-16), and still supposed to be the elitist path to university.

What we have is that about 2/3 of youth start working as apprentices age 15-16, combined with a trade school 1 or 2 days a week, over 2 to 4 years depending on trade. They have the option to work on a "Pro" High School diploma at the same time, allowing them to enter a tertiary school afterwards. Nowadays we have a growing number who finished High School only to fall back to an apprenticeship, despite the scary stories of scholarly teachers.

In many fields, like in mine, the dream employee is one that did an apprenticeship followed by a part-time engineering Bachelor (about 70% work, 70% studying, hardcore but doable), all while staying with the same employer : having started at 15, at 23 he'd have both an Engineering Bachelor and 8 years of experience working in the trade and company, complete with an all encompassing perspective of the workflow. Some might even follow up with a Master in the top engineering schools, but those are a rarity I'd wager.

[Zan15]

My credit is 799. I never pay interest on my credit card since I pay it off every month. I'm not retarded.

Just a quick google.

https://wallethub.com/edu/cc/credit-...st-rates/52541



https://www.nerdwallet.com/article/l...20is%20federal.

i am a CEO with a credit score of 9001 !!!

[Draco-Onis]

My credit is 799. I never pay interest on my credit card since I pay it off every month. I'm not retarded.

Just a quick google.

https://wallethub.com/edu/cc/credit-...st-rates/52541



https://www.nerdwallet.com/article/l...20is%20federal.

That's the average though you should call your credit card company and ask for a lower rate, you can easily get 14.5% or less. Maybe it doesn't matter to you since you always pay in full so up to you.

[GreenJesus]

That's the average though you should call your credit card company and ask for a lower rate, you can easily get 14.5% or less. Maybe it doesn't matter to you since you always pay in full so up to you.

I dont hinestly know what my own credit card interest rate is since I've never paid it.

[Zan15]

You say that like you think a 799 is some impossible score or something.

whelp since the average according to reports is 710-715 depending on which credit company 2020 report you believe, having a 799 would be a nice feat.


How do you not know i am a CEO? The point was making statements that could not be proven since he would never provide the facts needed. Also comments are made based on history of user which sometimes post very questionable statements.

[Spectral]

That's the average though you should call your credit card company and ask for a lower rate, you can easily get 14.5% or less. Maybe it doesn't matter to you since you always pay in full so up to you.

There's a set of tradeoffs there though. Some of the "best" credit cards include high interest and annual fees, but have perks that can add up to much higher value than the costs (assuming that you never actually run the interest on them). I wouldn't ever advise someone that isn't pretty financially organized to get these since it's easy to rack up high costs and not realize any benefits from them, but interest rates aren't really the only benefit you can get out of a high credit score.

[cubby]

I dont hinestly know what my own credit card interest rate is since I've never paid it.

And you're still avoiding the big boy issue.