A little OT but does concern debt incurred.

After years of doing credit reports and running credit it has occuried to me the debt from student loans are truly crushing SOME people.

I suggest this. Currently you can't wipe out student debt from a BK claim. WHY is that? All other debts are cleared. If this student debt is allowed to be cleared off the books it may make lenders think twice about who's "qualifying" for these loans. Those who declare BK will have to prove as part of the BK claim they can't pay-- and then the BK court could rule that some payment must be made by Mr. Harvard grad-- maybe not now but in 3 years when he's knocking down 3M a year. The bottom line is not everyone with high student loan debt will declare BK-- lenders who gave out fraudulent loans would also be put on the hook for these BAD loans and the loans be kicked back to them.

Car, boat, house, student loan or mashed potatoes.

Debt is Debt.

No forgiveness.

The problem I have with them is HOW HUGE the debt is that's pushed onto kids 18 years old. What do kids that age knoe about anything?

This issue is a monster larger than just one solution.

I went to a private university for undergrad. I remember watching tuition rates skyrocket during my four years. What I used to be able to get for about $10k+/year when I started (room, board, fees, hours) was up to around $12k+/year when I left. (And going from $258/credit hour - $329/credit hour in four years was pretty significant.If I hadn't graduated on time, it would have been $355/hr the next year.)

But I would now get charged $43k/year if I sent my kids there. It's a good environment--- but why in the world would I send my kids to study at a place that costs me the equivalent of what I paid for my four-year degree every year?

I graduated with $16k in debt. In 2005, the average student loan borrower graduated with $17k in debt. In 2018, the average borrower graduates with $37k in debt.

Did anyone else giggle at the House Financial Services Committee hearings back in April? The one where they brought in all the big bankers to account for themselves regarding the student loan crisis? But the feds nationalized student loans back in 2010 as part of the ACA.

It was intended that the profits from student loans help subsidize the costs of ACA. Prior to that, about half of student loans originated from private lenders, and half of student loans originated from the government, but all were guaranteed by the govt.

The Education Department sez revenues from the student loan program plummeted by 80% between 2012 and 2015— there's a nice write-up about that over at the WSJ. ("U.S. Student-Loan Program Losing Money as Borrowers Seek Debt Forgiveness") Debt forgiveness drained out $11.5 billion from the program just in 2015 alone.

Student loan debt was formidable in 2009-- at $154.9 billion. But it was up to $1.1 trillion eight years later, in 2017. And now, in 2019, it's estimated at around $1.5 trillion, according to a statistic in one news article I read.

Student loans are trash. Never took them, even back in the day when college was more "Afforable". I qualified for something like $30,000 ... even though 4 years tuition at my university was only $10,000. I could've lived in the nicest, newest dorms, gone out to nice restaurants, partied in Cancun, and driven a fancy car.

Instead, I drove a 10-year-old Camaro ($3,000-cash buy) and lived in a 2-car cinder block garage that was converted into an apartment. My Spring Break was a road trip to the South Dakota Badlands and eating "expired" Doritos from a 2nd hand food store.

I will concur with this much, at least. There should be a few more requirements in order to qualify for a student loan. They should not be given to the rather high percentage of college students who use college as a way to play for 4 more years before having to go out and work or to take any responsibility.

Loan should not be available for the type of degree that has no economic value whatsoever. Nor to students that have no clue about how to pay money back.

But yes, borrowed money should be paid back.

How about a Yale degree so you can teach kindergarten? When a local less expensive degree for the same end result would do?

BUT I WANT TO GO TO YALE? at 160K a year! I can't be stopped-- so we should pay for that decision. This plan is getting rich kids off the hook-- not poor students.

MYOB-I don’t know the school. The debt was on her credit report. I suspect it was not Yale (smile). I think she supported herself and kids on student debt while she was in school.

Back in grad school, one of my professors told the story of how some students were going to law school. They lived high on the hog and took out the max student loan each semester. Partied hard and got through law school. As soon as they passed the bar, they declared bankruptcy and got rid of the student loans. Now here they are fresh out of school and $0 debt. Once congress caught wind of what just happened, there was a law passed making student loans unbankruptable.

Idk if this story is true or not, but this is why you cannot declare bankruptcy on a student loan. I don't like where the costs of college tuition is going, but everything is going up. College just seems to be going up faster than anything else. Mike Rowe is pushing for more trade schooling and I'm starting to get on this bandwagon too. Plumbers, HVAC, etc are all retiring now and you can enter the field making a very good salary with a fraction of the schooling. Those salaries are also going up because of the shortage.

I believe a good start to this loan debate might be only loaning the money for tuition and books. Stop loaning so much more to "live" off of. I had friends in college that were going to Padre Island every spring break and had the attitude of "Eh, I'll pay it back later." Guess who's singing the blues now because they still are paying on student loans? STOP MAKING THIS A POSSIBILITY!

Doogie, yep, I'm a huge fan of Mark Rowe and have been for a long time.

When I taught my first year (1999), a group of teachers I was in got to go to the local community college and hear three speakers on the topic of the A+ program, which provides paid tuition for 2 years to get an associates degree. The most intriguing and dynamic speaker was a guy who taught welding and machining. He owned a local shop and told us that in two years he could have any one of our students earning $50,000/year starting salary, and own their own shop within 3 years making over $100K. This in a town where TODAY (20 years later), the median household income is $30,000.

I was astounded. Where was this guy when I was in college trying to figure out what to do with myself and decided to spend 5 years getting an education degree to get a job barely clearing $30K?

"Back in grad school, one of my professors told the story of how some students were going to law school. They lived high on the hog and took out the max student loan each semester. Partied hard and got through law school. As soon as they passed the bar, they declared bankruptcy and got rid of the student loans. Now here they are fresh out of school and $0 debt. Once congress caught wind of what just happened, there was a law passed making student loans unbankruptable."

Most student will not be dismissed in a bankruptcy. Wishful thinking.

I've had higher educated professionals with masters degree's, double master's degree's a even PhD's. They are what I call a "professional student". They will do anything to avoid working full time....

I have zero - zero - zero sympathy for anyone (read: coddled, spoiled, entitled millennials and all those that follow) with student debt, of any kind, regardless of what degree they got or from whence they got it. I agree totally with Sid.

Debt is debt. It's their own fault they went to a school they couldn't afford and/or didn't work through college and/or didn't save up ahead of time. They key phrase here is "their own fault".

Tell them to start listening to Dave Ramsey regularly if they need help in getting real.

I have zero - zero - zero sympathy for anyone (read: coddled, spoiled, entitled millennials and all those that follow) with student debt, of any kind, regardless of what degree they got or from whence they got it. I agree totally with Sid.

Debt is debt. It's their own fault they went to a school they couldn't afford and/or didn't work through college and/or didn't save up ahead of time. They key phrase here is "their own fault".

Tell them to start listening to Dave Ramsey regularly if they need help in getting real.

Nothing fraudulent about them, the students were just stupid using them. They financed everything from overpriced school tuition they couldn't afford, a fancy apartment they couldn't afford, probably their food and weekend activities too. They saw this as free money and they lived high off the hog. Never once thinking about the day they had to pay it back. Now that the day has finally come, they claim they are victims. They aren't victims of predatory lenders, they're victims of overpriced schools and of their own stupidity, most of which is the latter.

Come on Jan. What does an 18 year old know about the long lasting NEGATIVE impacts of this huge debt load? ZERO!!! Absolutely nothing.

Not all of them were snowflakes when signing the debts. Many are known as that now, but a lot were just young kids hopeful for their futures.

I'm part of that generation. Mine are paid because I hustled and educated MYSELF on personal finance. certainly not my high school teachers or college professors who probably are broke in their personal lives like most other job working Americans.

Generalizing here of course.

If personal finance was taught in high schools across the country we wouldn't be in this mess.

But that's not the mission of the public education system is it?

It's certainly not to teach kids finance, investing, budgeting, entrepreneurship or anything that actually BENEFITS them from a sustainable standpoint.

Its job is to grind out mindless drones. PERIOD.

Entry level to executive level drones.

It sells (brainwashes) the idea to kids that they needs to get good grades to get into colleges and get a high paying job. Ya sure, but at what cost?

Decades of what is basically indentured servitude.

So I have mixed feelings on people who are trying to bail out of it. Kind of like medical debt on credit reports in my opinion.

They are only kids when they take on the burden of this.

My spouse got suckered by the Art Institute when we first met. She was 22, had some GI money for tution but nit for expenses. AI fleeced her out of $24,000 for two semesters, that ultimately cost us over $30,000. On TOP of sucking $9,000 out of her GI savings.

Jan I'm sorry, you are incorrect. 18-22 year olds do not have enough background to negociate these sophisticated predators and their crooked schemes. My spouse was no fool, she had a 2 year degree, she was a Navy vet. But she didn't have a career path and AI offered this fun program that would cover all her living expenses and she'd make "big money" as a game designer! What kid doesn't want to live by the beach and play/make video games?

NEVER, EVER LET ANYONE TAKE OUT A STUDENT LOAN. It took my spouse seven years to get her B.S. degree. I knew the minute we met she was being ripped off, but I couldn't exactly "Dave Ramsey" her on our first date. Plus I was nearly broke too. And AI's actual classes were pretty good, that's what's sad. After a few months I mentioned she should start looking at grad schools for after AI. That was when we learned they are "self accredited" and their units don't transfer. Their degrees are WORTHLESS. Less than worthless actually.

And ooooh boy - they did NOT like me when I started my interrogations. They crowed about how "game designers" make $50,000 a year. I mentioned that garbage men in San Diego made $90,000!

Anyway, she quit AI after one year (could have attended Harvard for less) she had to sit out an entire year because we missed the app dates, but ultimately she went to UC San Diego, graduated as valedictorian in computer science, a "real" degree. We funded the additional three years with her remaining GI account and a couple small grants, and cash flowed living expenses - and by then we were making serious money flipping houses in the boom. Subsequently she got degrees in Real Estate and Escrow.

We paid off the loans (5 in 9 months!) about five years ago. Kept hoping for loan forgivness but nope. If they do it now I want my money back!

I shudder to think of her peers who graduated $120,000 in debt with non employable degrees. Older people are trapped in this too. I know people my age who went back to school in their 40's and will be paying for life or have their credit wrecked. I don't know what happens when their only income is social security.

Sid, I figured as such about the food stores. We had a different name for them, but, yeah, I’m familiar with them too. It was kind of fun ‘back in the day’ to enjoy some fun while still meeting out very good savings goals.

I’m split on the argument about kids aren’t ready for this, or, it’s their own fault argument. There is a very strong streak of frugality that runs through my family. Problem is, some people rebelled from it, not even realizing they were rebelling. One of my sisters, only two years older, said she was never taught about finance, economics, neither at school nor at home. I was just flummoxed over that comment. We had the same parents, the same teachers in high school. How could she even say that? I had a great education in finance, economics, both in high school and at home. But, my sister and I have very different perspectives on life, very different personalities. So, I guess the message needs to be planted on fertile ground.

I'm also split on the subject. My oldest is pretty bright and frugal but as he was considering what degree he wanted to pursue he was stuck on the idea of what sounded "interesting" to him VS what he could make a living at. It took a year of prodding him to look at the job opportunities of his whims before it sunk in and he made the right choice.

Face it, how many 18 year old's understand how to live on $x per month, 10% or less? What a water bill costs, rent, gas, etc. So how do they make an educated decision about something as complicated as the risk of having to take a low paying job and paying the regular living expenses as well as a student loan once they graduate. Compound that with the social pressure they get telling them to make sure they pick something they like because they will be doing it for the next 50 years and it's no wonder the decisions they make are often bad.

I've had droves of tenants stuck in a $30K a year job with over $100K in student loans. They are bond slaves to their government for the next 30 years because they were stupid when they were young.

My daughter graduated high school with a good number of "college credits" by taking the right courses. She really liked a private college and also applied to some states schools. When the numbers came in for the private school, they looked very affordable, decent scholarship, even matched another private school amount that was greater when asked. But it included a lot of loans. She looked at paying the same amount without loans and without a scholarship from the school itself at the public university and chose that. Yes, she understood loans had to be paid back with interest and she could get an education and degree without them. She also held a job to pay for personal expenses during those years.

At graduation, she actually felt guilty that she could not talk about the next step and paying off the loans like all her friends, but was so relieved she did not have to worry about it. My beef was that she didn't get "job training" with her degree, but she did start as a temp with a great company and now is an employee with a decent salary. No loans, bought a new car without a loan once she saved enough, and bought a fixer up house because she did learn other life skills. Her advice to all the older people she works with whose kids are looking at college - go to the public university. She is so glad she did.

Since she is responsible and frugal, why should someone who is not, get their loan forgiven. That penalizes her for her choices. If you know the loans will be forgiven, why would you not take out the biggest loans possible, it would be free money.

I agree with others that there should be no debt forgiveness.

I remember sitting at a party having a conversation about this with a friend who has little kids. He said he read somewhere that when his kids are 18 he will have to pay $500k for an undergrad degree.

I flat out said IDK if that is correct but if it is, its simply no longer worth it.

Let's not forget how much added junk these schools have that run up the cost of attendance.

When my sister went to college in '73, she had a plain jane dorm room with a roommate and shared bath with the 2 gals next door. No TV allowed in the room (couldn't afford to have one, anyway). Cafeteria food, only thing edible was desserts. They had a rec area with bowling, ping pong, gym stuff. You hung out in the common room and watched the communal TV which had 5 channels. Or, you know, talked.

No frills, just learning.

Fast forward to my son's experience (and he's been out 10 years now! BTW, $25K debt for 5 years and he is a software engineer making 6 figures) Cafeteria, yes; but made to order food if wanted. Also Taco Bell, Starbucks, Subway. Rock climbing, video gaming area, dorms first year but apartments after that. He had roommates but most did not. Campus is beautiful, rooms are beautiful, everything is beautiful. That stuff costs money, and since Uni’s have to spend money that is what you end up with, this crazy circular thing of rising costs and rising expectations on the part of parents and students.

A co-workers daughter just wrapped up her freshman year. Had a dorm, 1 roommate. Roomate wanted her own room, which is double the cost. So his daughter ended up with a single room too but without the additional cost.

I think they should offer a no frills plan!