Can't believe this isnt a bigger issue!!!!

[CuriousPharmD]

that government based student loans are at 6.8%!!! With the upcoming presedential election coming up next year I believe this should be a huge talking issue/talking point that seems to be non-existent!!!

It is outrageous that mortgages and car loan interest rates can be had for even less than half of this...yet i cant believe this is not a bigger issue!!!

on top of that the student loan interest rate is not even deductible for most of us while mortage interest is?? DOESNT MAKE SENSE AT ALL!!!

Obtaining advanced education seems to be always stressed as a priority in this country but HOW IS THAT WE DONT GET TAX BREAKS for bettering ourselves!!! I guess I can see why now!!! THE GOVERNMENT GETS PAID!!! WHILE IT SEEMS LIKE EVERYBODY ELSE GETS A BAILOUT FOR STUPIDITY while we seem to be getting the bill while we doin the right thing by getting an education to try and live a better life for ourselves and our families!!!

if the politicians truly care about the future of this country...either lower the interest rates on these loans or make them tax deductible at least!!! it takes pressure of the FUTURE earners in this country by doing this and at least contribute a little to all the problems this country has....

if you want an increase in younger people to vote in this country make this a political platform....AND YOU WILL GET MY ATTENTION AND COUNTLESS OTHERS!!!

IS THERE ANYTHING WE CAN DO??? write to politicians, make phone calls, picket, anything???

just had to get that off my chest....so ridiculous how this is not a bigger political issue!!!

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[Hello2011]

that government based student loans are at 6.8%!!! With the upcoming presedential election coming up next year I believe this should be a huge talking issue/talking point that seems to be non-existent!!!

It is outrageous that mortgages and car loan interest rates can be had for even less than half of this...yet i cant believe this is not a bigger issue!!!

on top of that the student loan interest rate is not even deductible for most of us while mortage interest is?? DOESNT MAKE SENSE AT ALL!!!

Obtaining advanced education seems to be always stressed as a priority in this country but HOW IS THAT WE DONT GET TAX BREAKS for bettering ourselves!!! I guess I can see why now!!! THE GOVERNMENT GETS PAID!!! WHILE IT SEEMS LIKE EVERYBODY ELSE GETS A BAILOUT FOR STUPIDITY while we seem to be getting the bill while we doin the right thing by getting an education to try and live a better life for ourselves and our families!!!

if the politicians truly care about the future of this country...either lower the interest rates on these loans or make them tax deductible at least!!! it takes pressure of the FUTURE earners in this country by doing this and at least contribute a little to all the problems this country has....

if you want an increase in younger people to vote in this country make this a political platform....AND YOU WILL GET MY ATTENTION AND COUNTLESS OTHERS!!!

IS THERE ANYTHING WE CAN DO??? write to politicians, make phone calls, picket, anything???

just had to get that off my chest....so ridiculous how this is not a bigger political issue!!!

Tell me how you feel about no more subsidized stafford loans for pharmacy students and I'll tell you why I'm at a 3 year school.

 

[netmag]

The various political entities make it plainly clear and obvious where they stand on these types of things. So if it's a high priority issue to you then one thing you can do is make sure you vote. If you don't, then you get whatever you get.

 

[PharmEcon]

The number one thing government can do to reduce student debt is to reduce student loan aid.

Also, politicians should not have the power to increase and reduce interest rates in my opinion- way too much moral hazard.

Oh and those who got bailed out did so due to moral hazard and special interests- it's all about the $$$.

 

[awval999]

The number one thing government can do to reduce student debt is to reduce student loan aid.

Also, politicians should not have the power to increase and reduce interest rates in my opinion- way too much moral hazard.

Oh and those who got bailed out did so due to moral hazard and special interests- it's all about the $$$.

This.

 

[CuriousPharmD]

The various political entities make it plainly clear and obvious where they stand on these types of things. So if it's a high priority issue to you then one thing you can do is make sure you vote. If you don't, then you get whatever you get.

how does me voting help? i dont know where politicians stand on this issue...

 

[CuriousPharmD]

The number one thing government can do to reduce student debt is to reduce student loan aid.

Also, politicians should not have the power to increase and reduce interest rates in my opinion- way too much moral hazard.

Oh and those who got bailed out did so due to moral hazard and special interests- it's all about the $$$.

then answer my questions///

how do you expect students to pay for these crazy high tuition fees these schools charge if the govt reduces student loans?

so if you think that politicians shouldnt have the power to change student loan interest rates....then who should?
i thought these fixed rates of 6.8% are from government issued loans and there was some kind of law stating that they had to be fixed???

 

[owlegrad]

Why would you think this would be a bigger issue? Do you think even 1% of Americans are the least bit interested in this issue? Or even aware of it?

I was surprised the whole no subsidized Stanford loans for professional students thing wasn't a bigger issue, but when you think about, most people do not care about students. They are busy working, taking care of their family, etc. Only students care about students, and we are not a strong political force.

 

[PharmEcon]

then answer my questions///

how do you expect students to pay for these crazy high tuition fees these schools charge if the govt reduces student loans?

Why do you think schools can charge fees that high and still get students?

so if you think that politicians shouldnt have the power to change student loan interest rates....then who should?

The market.

Why would you think this would be a bigger issue? Do you think even 1% of Americans are the least bit interested in this issue? Or even aware of it?

It is all about incentives. It is possible to change their incentives (or more importantly [unfortunately] the incentives of politicians), but it has not happened yet and I am not sure it will.

 

[CuriousPharmD]

Why would you think this would be a bigger issue? Do you think even 1% of Americans are the least bit interested in this issue? Or even aware of it?

I was surprised the whole no subsidized Stanford loans for professional students thing wasn't a bigger issue, but when you think about, most people do not care about students. They are busy working, taking care of their family, etc. Only students care about students, and we are not a strong political force.

yeah i thought it would be a bigger issue...especially among the type of people that come to this forum...but i guess you guys dont really care about this which is evident by the replies to my post....WHICH IS CRAZY TO ME!!

the way student loans are handled is so unfair in comparison to other loan products...

i thought i was goin to get some help or at least some support here...guess not.

GOOD LUCK finding jobs when you get out with those high student loans along with crazy high interest rates!!!

 

[type b pharmD]

IBR. pay what you can, and the loans are forgiven. this is one reason people do not care. also loan interest is deductible up to a point. I'm thinkin maybe.. work 20 hrs/week after graduation, deduct all of my interest payments, and pay $500/month on the loan until it is forgiven.

Seriously, do some more research.

And btw, dont vote for ron paul then, because he wants to eliminate ALL student loans

 

[CuriousPharmD]

Why do you think schools can charge fees that high and still get students?


The market.



It is all about incentives. It is possible to change their incentives (or more importantly [unfortunately] the incentives of politicians), but it has not happened yet and I am not sure it will.

they get away with it cuz i believe these students are somewhat ignorant with the job situation out there and how easy it is to get jobs to pay off these high student loans

how would the market change the student loan interest rate when they are controlled by the govt?

and i guess your right on the last point about incentives...i thought politicians had a duty to do what's right and fair and cared about the future of this country and to help the people that are doing things right....my bad!

 

[CuriousPharmD]

IBR. pay what you can, and the loans are forgiven. this is one reason people do not care. also loan interest is deductible up to a point. I'm thinkin maybe.. work 20 hrs/week after graduation, deduct all of my interest payments, and pay $500/month on the loan until it is forgiven.

Seriously, do some more research.

And btw, dont vote for ron paul then, because he wants to eliminate ALL student loans

from my understanding IBR is not for us...basically with the higher monthly after 10 years the loan would be almost or totally paid off...its basically for earners that have our kind of student debt but make like 30-50k a year...and i think you have to work in a job that is eligible for loan forgiveness...maybe you should do some more research while your in school...

and i dont get your 20hrs/week work week just to stay under the salary requirement to deduct your interest rate....you would have to do this for 10 years....NOT REALISTIC AT ALL!!!

and eliminating all student loans aint happening even if he gets elected...WAY TO DRASTIC!!

 

[Ackj]

So if it's a high priority issue to you then one thing you can do is make sure you vote. If you don't, then you get whatever you get.

Common fallacy about the US government. We do not have a direct democracy. No matter what way you vote, or don't.... you get whatever you get. "yes we can" quickly became "no we didn't"

 

[type b pharmD]

from my understanding IBR is not for us...basically with the higher monthly after 10 years the loan would be almost or totally paid off...its basically for earners that have our kind of student debt but make like 30-50k a year...and i think you have to work in a job that is eligible for loan forgiveness...maybe you should do some more research while your in school...

and i dont get your 20hrs/week work week just to stay under the salary requirement to deduct your interest rate....you would have to do this for 10 years....NOT REALISTIC AT ALL!!!

and eliminating all student loans aint happening even if he gets elected...WAY TO DRASTIC!!

Under my projections, I will qualify for IBR for the entire 25 years, and will end up with a forgiveness of around 350-550k (depending on if full time or part time). If you have high amounts of loans and qualify at the outset,, you will qualify for IBR for your entire career, due to negative amortization (aka capitalization). You can work any career, the position does influence whether you can get 10 yr forgiveness or 25 yr forgiveness. And one of the reasons I got into pharmacy was to work part time. No reason to work 40 hours /week if you dont have to, especially if you can get insurance on the upcoming exchanges.

 

[owlegrad]

yeah i thought it would be a bigger issue...especially among the type of people that come to this forum...but i guess you guys dont really care about this which is evident by the replies to my post....WHICH IS CRAZY TO ME!!

the way student loans are handled is so unfair in comparison to other loan products...

i thought i was goin to get some help or at least some support here...guess not.

GOOD LUCK finding jobs when you get out with those high student loans along with crazy high interest rates!!!

My bad, I thought you wanted a rational discuss of the issue. If I had realized all you wanted was support, I would have given it to you. Sorry about that.

You can use IBR if you need it. If you don't need it, what exactly are you complaining about? That the interest rate is too high? Fair enough, but I don't see that being a major issue anytime soon. Don't confuse that with not caring though, it is simply a realistic outlook.

 

[CuriousPharmD]

Common fallacy about the US government. We do not have a direct democracy. No matter what way you vote, or don't.... you get whatever you get. "yes we can" quickly became "no we didn't"

yes sir!!! finally someone with reason?? is there a solution?

 

[CuriousPharmD]

Under my projections, I will qualify for IBR for the entire 25 years, and will end up with a forgiveness of around 350-550k (depending on if full time or part time). If you have high amounts of loans and qualify at the outset,, you will qualify for IBR for your entire career, due to negative amortization (aka capitalization). You can work any career, the position does influence whether you can get 10 yr forgiveness or 25 yr forgiveness. And one of the reasons I got into pharmacy was to work part time. No reason to work 40 hours /week if you dont have to, especially if you can get insurance on the upcoming exchanges.

your goin to still have 350-550k in student loans after 25 years?? does anyone else see something wrong here?

 

[type b pharmD]

your goin to still have 350-550k in student loans after 25 years?? does anyone else see something wrong here?

Under IBR, loan balances increase every year if your income is low compared to the loan. It is common sense. If you are only paying $6,000/year on the loan but it is accruing $15,000 in interest per year, this is called negative amortization.. If i was to pay back my loan in full after graduation, I would pay about 260k. If I chose 25 year IBR, and followed a defensive tax strategy during the forgiveness period, I will only end up paying around 130k. These amounts vary, depending on a number of factors, but the bottom line is, you can benefit from government forgiveness depending on the time frames, income, hours worked, interest rates, and loan balances. Who knows, maybe when I get out I would want to work 40 hours/week and pay back my loans immediately. Or, most likely, it would be beneficial to take advantage of forgiveness options.

 

[PharmEcon]

they get away with it cuz i believe these students are somewhat ignorant with the job situation out there and how easy it is to get jobs to pay off these high student loans

The reason tuition is so high is because there is this societal notion (and no it is not just limited to students, but often to their parents, teachers, etc. too) that every child should go to a 4-year school and possibly grad school, etc. almost regardless of cost. The government offers all of this money to "help", when in reality it only leads to schools competing to see who can build the best luxury resort to attract students who are willing to take any debt on (and can do so because of the government "assistance") because they believe college will make their lives a lot better regardless of what they major in, etc. It is a vicious cycle. Unfortunately, it is most likely an asset bubble much like the housing bubble was, except this time, there is no foreclosure when it bursts.

how would the market change the student loan interest rate when they are controlled by the govt?

The point is they shouldn't be controlled by government.

and i guess your right on the last point about incentives...i thought politicians had a duty to do what's right and fair and cared about the future of this country and to help the people that are doing things right....my bad!

Eh... politicians sometimes might try to do what is best but what is best is subjective and the vast majority of the time special interests control what happens. Politicians like most people think of themselves and their families first- they want to get reelected for example. As the saying goes, "power corrupts and absolute power corrupts absolutely".

Common fallacy about the US government. We do not have a direct democracy. No matter what way you vote, or don't.... you get whatever you get. "yes we can" quickly became "no we didn't"

I would take a constitutional republic over a direct democracy any day- the tyranny of the majority can be devastating. The fundamental problem in today's government is that special interests have been allowed to essentially buy and dictate policy.

 

[Ackj]

I would take a constitutional republic over a direct democracy any day- the tyranny of the majority can be devastating. The fundamental problem in today's government is that special interests have been allowed to essentially buy and dictate policy.

I don't disagree, the majority of people are idiots and what everyone wants is rarely what's best. My point was that it would be naive to think that voting for a certain politician because of their opinion on a single issue, like student loans.

 

[CuriousPharmD]

My bad, I thought you wanted a rational discuss of the issue. If I had realized all you wanted was support, I would have given it to you. Sorry about that.

You can use IBR if you need it. If you don't need it, what exactly are you complaining about? That the interest rate is too high? Fair enough, but I don't see that being a major issue anytime soon. Don't confuse that with not caring though, it is simply a realistic outlook.

yea i wanted a rational discussion and u aint providing it....OF COURSE THE INTEREST RATE IS TOO HIGH!!! didnt u read my initial post and we cant even deduct the interest rate since we make too much money...fricking ridiculous!!! and its a major issue NOW!!! maybe not for you since in your school but just wait!!! hopefully you can get a job to pay them off!!! who knows by the time you graduate the interest rate might be higher!!! then we'll see if you have the same tune!!!

 

[CuriousPharmD]

The reason tuition is so high is because there is this societal notion (and no it is not just limited to students, but often to their parents, teachers, etc. too) that every child should go to a 4-year school and possibly grad school, etc. almost regardless of cost. The government offers all of this money to "help", when in reality it only leads to schools competing to see who can build the best luxury resort to attract students who are willing to take any debt on (and can do so because of the government "assistance") because they believe college will make their lives a lot better regardless of what they major in, etc. It is a vicious cycle. Unfortunately, it is most likely an asset bubble much like the housing bubble was, except this time, there is no foreclosure when it bursts.


The point is they shouldn't be controlled by government.


Eh... politicians sometimes might try to do what is best but what is best is subjective and the vast majority of the time special interests control what happens. Politicians like most people think of themselves and their families first- they want to get reelected for example. As the saying goes, "power corrupts and absolute power corrupts absolutely".


I would take a constitutional republic over a direct democracy any day- the tyranny of the majority can be devastating. The fundamental problem in today's government is that special interests have been allowed to essentially buy and dictate policy.

of course i know why the tuition is so high cuz the schools can get away with it by govt back loans..duh!!!

and the point is THEY ARE controlled by the govt...IS THERE ANYTHING WE CAN DO ABOUT HOW THIS THING IS BEING HANDLED????....need possible solutions not explanations of how the system is....i went thru the system and know it well...

 

[PharmEcon]

of course i know why the tuition is so high cuz the schools can get away with it by govt back loans..duh!!!

and the point is THEY ARE controlled by the govt...IS THERE ANYTHING WE CAN DO ABOUT HOW THIS THING IS BEING HANDLED????....need possible solutions not explanations of how the system is....i went thru the system and know it well...

I'm not sure you do based on what you wrote, but the best thing you can do is just look out for yourself. Unless you have tremendous resources and/or connections, changing government policy will be a lot harder than hedging for yourself and protecting yourself for the worst.

 

[type b pharmD]

of course i know why the tuition is so high cuz the schools can get away with it by govt back loans..duh!!!
.i went thru the system and know it well...

I wouldnt go so far as to say "know it well" if you don't know about IBR and what negative amortization is

 

[PharmEcon]

To the IBR crowd: I will admit I am not awfully familiar with the program, but how big is the fund backing it? I doubt it is enough to cover even the majority of loans it says it will cover. Should something drastic happen, the government could always deny what it promised- wouldn't be the first time it happened.

Also, isn't one of the qualifications to be working in a qualifying occupation and if so, what if one can't find a job (because if they could- especially in pharm, they would probably be able to repay the loans anyway)?

 

[type b pharmD]

To the IBR crowd: I will admit I am not awfully familiar with the program, but how big is the fund backing it? I doubt it is enough to cover even the majority of loans it says it will cover. Should something drastic happen, the government could always deny what it promised- wouldn't be the first time it happened.

Also, isn't one of the qualifications to be working in a qualifying occupation and if so, what if one can't find a job (because if they could- especially in pharm, they would probably be able to repay the loans anyway)?

The qualification is based purely on debt to income ratio. Career does not matter for IBR. (You may be thinking of PSLF, a separate, but similar program) As far as I know, there is no 'fund' backing it, the expenditure on the government's end is based on the idea that after 25 years, the majority of people will pay back enough of their loans to make it a better value for the government and the economy compared to people defaulting en mass, had there not been IBR available. The fact that in 2014, IBR is switching from 25 years to 15 years, is a good sign I would think, since the government is in the process of greatly easing and expanding IBR, it would seem the possibility of it going away completely is low. But like everything, there are risks in life.

 

[a runner]

yea i wanted a rational discussion and u aint providing it....OF COURSE THE INTEREST RATE IS TOO HIGH!!! didnt u read my initial post and we cant even deduct the interest rate since we make too much money...fricking ridiculous!!! and its a major issue NOW!!! maybe not for you since in your school but just wait!!! hopefully you can get a job to pay them off!!! who knows by the time you graduate the interest rate might be higher!!! then we'll see if you have the same tune!!!

What makes you think the interest rate is "too high?" What do you want, 0%? Negative interest (ie. the government pay YOU to go to school)? Your comments sound like the typical entitled attitude that has ruined our country.

Why do you think society owes it to you to loan money to you at a lower rate than the market ever would? A little big of economics education would tell you that if the government is required to give out low interest loans to everyone that the demand for higher education will increase. Increased demand = increased prices. That's where we're at. The reason education costs so much is because of people who thought it'd be a good idea to make it so anyone can take out loans or get financial aid. It skews the cost/benefit analysis of consumers of education.

 

[owlegrad]

yea i wanted a rational discussion and u aint providing it....OF COURSE THE INTEREST RATE IS TOO HIGH!!! didnt u read my initial post and we cant even deduct the interest rate since we make too much money...fricking ridiculous!!! and its a major issue NOW!!! maybe not for you since in your school but just wait!!! hopefully you can get a job to pay them off!!! who knows by the time you graduate the interest rate might be higher!!! then we'll see if you have the same tune!!!

Dude you are cracking me up. I am the one not being rational?

Do I wish the interest rates were lower? Of course. Do I think it is more important than say the national debt? No. Plenty of issues are more important to me than the interest rate on student loans. For example, healthcare reform.

I do indeed hope that I can get a job to pay off my debt. You are mixing endpoints though. Student interest rates have no relationship to the job market.

 

[CuriousPharmD]

I wouldnt go so far as to say "know it well" if you don't know about IBR and what negative amortization is

who cares what negative amortization is...i told you ibr is not for pharmacists that intend to work full time when they graduate cuz the loan will be almost or paid off completely by the time forgiveness kicks in...the majority of us are goin to work full time and not do what you intend on doin to work part time and accrue almost half a million dollars in student loans to get them forgiven...can you say a drain on the us govt?? i can...hopefully you pay your taxes or do you get out of that too???

 

[type b pharmD]

who cares what negative amortization is...i told you ibr is not for pharmacists that intend to work full time when they graduate cuz the loan will be almost or paid off completely by the time forgiveness kicks in...the majority of us are goin to work full time and not do what you intend on doin to work part time and accrue almost half a million dollars in student loans to get them forgiven...can you say a drain on the us govt?? i can...hopefully you pay your taxes or do you get out of that too???

You should run some calculations. If you have >200-250k in loan debt, IBR is generally going to save you some money in NPV terms, compared to paying the loan in full, even if you work full time. Of course, it depends also on LIFESTYLE choices (and tax strategies), which will determine how much tax you will owe on the forgiveness. I plan to pay as little tax as I can, as, in my opinion, it is every smart person's imperative to do.

 

[a runner]

To the IBR crowd: I will admit I am not awfully familiar with the program, but how big is the fund backing it? I doubt it is enough to cover even the majority of loans it says it will cover. Should something drastic happen, the government could always deny what it promised- wouldn't be the first time it happened.

Also, isn't one of the qualifications to be working in a qualifying occupation and if so, what if one can't find a job (because if they could- especially in pharm, they would probably be able to repay the loans anyway)?

I agree this is one of the scary things of IBR. Students (especially ones with excessive loans because of family obligations, large living expenses from having a previous moderate paying careeer, etc.) tend to get little sypmathy from the public when it comes to this sort of thing, and it seems that this type of program would be one of the first on the chopping block come a fiscal disaster (which is looming) and widespread austerity. But what can you do if this is your only option to be able to make payments? I figure if the government defaults and can't pay for IBR anymore, then we'll have a new government anyways or the dollar will be worthless (as well as any dollar denominated debt ).

As for qualifying occupations, only PSLF (which is 10 years vs. 25 and there is no tax on forgiven loans) requires a specific job type to qualify, and the qualifications are quite broad. It can be ANY government job (local, state, federal- so you have county health systems, Indian Health Services, VA system, correctional facility health jobs, etc.) or any job for a non-profit company (most hospitals qualify).

 

[CuriousPharmD]

What makes you think the interest rate is "too high?" What do you want, 0%? Negative interest (ie. the government pay YOU to go to school)? Your comments sound like the typical entitled attitude that has ruined our country.

Why do you think society owes it to you to loan money to you at a lower rate than the market ever would? A little big of economics education would tell you that if the government is required to give out low interest loans to everyone that the demand for higher education will increase. Increased demand = increased prices. That's where we're at. The reason education costs so much is because of people who thought it'd be a good idea to make it so anyone can take out loans or get financial aid. It skews the cost/benefit analysis of consumers of education.

0% would be nice...but be realistic...in comparison to other loan products....lets see im repeating myself which was already stated in my initial post....they are too high when you can get mortgages and car loans for less than HALF of a student loan rate...jeezuz christ...its like arguing with idiots on this board...

and there is no fricking market for student loans...its the govt and THATS IT...private loans are worse in fact!!!

i dont expect society or govt to owe me anything otherwise i would make 40k a year get married and have like 6 kids so i dont have to pay taxes at all like half the country...

what i do expect is for student loan rates to be fair...if no change there...at least be able to deduct the interest....ESPECIALLY after i'm doin the right thing by being a productive member and citizen of this country and giving up about a third of my income....lets see thats about 35k a year....jeez what a drain on society....

u wont understand till you start work

 

[type b pharmD]

I agree this is one of the scary things of IBR. Students (especially ones with excessive loans because of family obligations, large living expenses from having a previous moderate paying careeer, etc.) tend to get little sypmathy from the public when it comes to this sort of thing, and it seems that this type of program would be one of the first on the chopping block come a fiscal disaster (which is looming) and widespread austerity. But what can you do if this is your only option to be able to make payments? I figure if the government defaults and can't pay for IBR anymore, then we'll have a new government anyways or the dollar will be worthless (as well as any dollar denominated debt ).

As for qualifying occupations, only PSLF (which is 10 years vs. 25 and there is no tax on forgiven loans) requires a specific job type to qualify, and the qualifications are quite broad. It can be ANY government job (local, state, federal- so you have county health systems, Indian Health Services, VA system, correctional facility health jobs, etc.) or any job for a non-profit company (most hospitals qualify).

Starting in 2014, The value of IBR is going to roughly double, as forgiveness will be offered after 15 years of payments. I see this as a good sign. The thing is, getting rid of IBR would not seemingly be a huge priority for cost cutting measures, as it does not represent a big 'handout' to the population, in fact, IBR generally is working to stabilize the economy and prevent people from defaulting on their loans, creating more money for the government in tax revenue, more consumer spending, and a more stable society due to individuals being encouraged to basically start a life for themselves instead of simply defaulting on student loans

 

[KARM12]

IBR only counts for federal loans, correct? Don't most students rack up this massive amount of debt from private loans?

 

[type b pharmD]

0% would be nice...but be realistic...in comparison to other loan products....lets see im repeating myself which was already stated in my initial post....they are too high when you can get mortgages and car loans for less than HALF of a student loan rate...jeezuz christ...its like arguing with idiots on this board...

and there is no fricking market for student loans...its the govt and THATS IT...private loans are worse in fact!!!

i dont expect society or govt to owe me anything otherwise i would make 40k a year get married and have like 6 kids so i dont have to pay taxes at all like half the country...

what i do expect is for student loan rates to be fair...if no change there...at least be able to deduct the interest....ESPECIALLY after i'm doin the right thing by being a productive member and citizen of this country and giving up about a third of my income....lets see thats about 35k a year....jeez what a drain on society....

u wont understand till you start work

Other loans are backed by collateral. So when comparing loan products, you should be comparing student loans to other unsecured loans. Out of all the unsecured loans I have, students loans carry the lowest interest rate by far. Last time I checked, ~7-15% was the rate offered by my bank for other unsecured loans.

 

[CuriousPharmD]

Dude you are cracking me up. I am the one not being rational?

Do I wish the interest rates were lower? Of course. Do I think it is more important than say the national debt? No. Plenty of issues are more important to me than the interest rate on student loans. For example, healthcare reform.

I do indeed hope that I can get a job to pay off my debt. You are mixing endpoints though. Student interest rates have no relationship to the job market.

did i ever say it was a bigger issue than the national debt? reckless govt spending? financial instability in the us or around the world? health care reform? did i say it was the single biggest issue we have? where did i post stating this? maybe im mistaken?

i never stated that student loan interest rates are directly related to the job market? point to me where i posted this...maybe im mistaken?

reread my initial post...

 

[PharmEcon]

But what can you do if this is your only option to be able to make payments? I figure if the government defaults and can't pay for IBR anymore, then we'll have a new government anyways or the dollar will be worthless (as well as any dollar denominated debt ).

The worst case scenario for students in this regard is not if the government defaults and drops its obligations to IBR, but if the government does not default and drops its obligations to IBR. That means, once more, the student is on the hook and as we know student debt is essentially for life.

It is a matter of personal analysis and opinion, but I for one do not place much trust in this program given the current state of government finances, operation and where I think it is heading. I also have my own plans so that I would never have to rely on such a program and I hope those will play out.

what i do expect is for student loan rates to be fair...if no change there...at least be able to deduct the interest....ESPECIALLY after i'm doin the right thing by being a productive member and citizen of this country and giving up about a third of my income....lets see thats about 35k a year....jeez what a drain on society....

Fairness is subjective. I don't think a lot of things are fair either when it comes to government policy and some groups (the ones that have bought out government) are most certainly better off than others as is. Unfortunately, all you can do is try to change the system or hedge so that you protect yourself. I plan on doing the latter.

 

[PharmDstudent]

that government based student loans are at 6.8%!!! With the upcoming presedential election coming up next year I believe this should be a huge talking issue/talking point that seems to be non-existent!!!

It is outrageous that mortgages and car loan interest rates can be had for even less than half of this...yet i cant believe this is not a bigger issue!!!

on top of that the student loan interest rate is not even deductible for most of us while mortage interest is?? DOESNT MAKE SENSE AT ALL!!!

Obtaining advanced education seems to be always stressed as a priority in this country but HOW IS THAT WE DONT GET TAX BREAKS for bettering ourselves!!! I guess I can see why now!!! THE GOVERNMENT GETS PAID!!! WHILE IT SEEMS LIKE EVERYBODY ELSE GETS A BAILOUT FOR STUPIDITY while we seem to be getting the bill while we doin the right thing by getting an education to try and live a better life for ourselves and our families!!!

if the politicians truly care about the future of this country...either lower the interest rates on these loans or make them tax deductible at least!!! it takes pressure of the FUTURE earners in this country by doing this and at least contribute a little to all the problems this country has....

if you want an increase in younger people to vote in this country make this a political platform....AND YOU WILL GET MY ATTENTION AND COUNTLESS OTHERS!!!

IS THERE ANYTHING WE CAN DO??? write to politicians, make phone calls, picket, anything???

just had to get that off my chest....so ridiculous how this is not a bigger political issue!!!

Please don't jinx us! There are plenty of people out there who are opposed to the mortgage interest deduction. http://www.cnn.com/2010/OPINION/12/02/brown.repeal.homeowner.break/index.html


If I recall correctly, President Bush had something to do with the hike in the federal student loan interest rates.


IBR just delays things if you find a better job within those 10 or 25 years, because you'll have to pay what you normally would anyway, plus what was "deferred" until the debt is forgiven after 10 or 25 years.
It's backwards logic for pharmacists, if you ask me. It promotes the idea that if you work less, then you'll make less and pay less.

Company matching and benefits tells me that you should work more. For example, if my company matches 2% of my income at roughly 3 dollars per dollar, then they are "giving" me $5,200 per year if I make $130,000 per year and benefits if I work more than 30 hours per week.

 

[type b pharmD]

Please don't jinx us! There are plenty of people out there who opposed to the mortgage interest deduction.


If I recall correctly, President Bush had something to do with the hike in the federal student loan interest rates.

IBR just delays things if you find a better job within those 10 or 25 years, because you'll have to pay what you normally would anyway, plus what was "deferred" until the debt is forgiven after 10 or 25 years.
It's backwards logic for pharmacists, if you ask me. It promotes the idea that if you work less, then you'll make less and pay less.

Company matching and benefits tells me that you should work more. For example, if my company matches 2% of my income at roughly 3 dollars per dollar, then they are "giving" me $5,200 per year if I make $130,000 per year and benefits if I work more than 30 hours per week.

This is why IBR cannot be recommended as a blanket "best option". For pharmacists, as I and many others on this board have stated, IBR is not the 'best option' for a sizeable majority of PharmD's. However if certain lifestyle and financial considerations are at play (working outside the pharmaceutical field, working part time and raising a family, having >250k in loan debt, starting your own business, hiding assets and reducing tax liabilities, asset to debt ratios, among others), it is possible to "game" the system and significantly benefit from IBR.. but like anything else in life financially, it is a risk vs reward scenario. (Basically agreeing with you here)

 

[PharmDstudent]

IBR. pay what you can, and the loans are forgiven. this is one reason people do not care. also loan interest is deductible up to a point. I'm thinkin maybe.. work 20 hrs/week after graduation, deduct all of my interest payments, and pay $500/month on the loan until it is forgiven.

Seriously, do some more research.

And btw, dont vote for ron paul then, because he wants to eliminate ALL student loans

Ron Paul is right. If student loans were abolished, then they would have to come down on the cost of tuition and fees or else the schools would close.

 

[a runner]

0% would be nice...but be realistic...in comparison to other loan products....lets see im repeating myself which was already stated in my initial post....they are too high when you can get mortgages and car loans for less than HALF of a student loan rate...jeezuz christ...its like arguing with idiots on this board...

and there is no fricking market for student loans...its the govt and THATS IT...private loans are worse in fact!!!

u wont understand till you start work

Actually, I understand it well enough seeing as I've spent more than five years working full time before I went to pharmacy school, even making enough to be in the 47% of society that PAYS taxes.

You can't compare apples to oranges. Mortgages and car loans are secured by collateral, student loans are completely unsecured. And I don't agree with how low these other loans are either. That's why we had the housing bubble and the economy is in shambles, because the government intervened in the market and made it so banks could make bad loans and have them backed by the government.

There's a reason why there is almost no market for private student loans... because the government has usurped the market! Also, most banks in their right minds would not make a loan to a 18-25 year old with no income, no co-signer, no collateral, and at a low rate (it has to be a low rate, otherwise nobody would use private loans when you have 6.8% low rate loans offered by the government). Just the fact that there is no private student loan market anymore should tell us that government student loan rates are too low! The private loan market isn't willing to compete at that low of an interest rate.

 

[type b pharmD]

Ron Paul is right. If student loans were abolished, then they would have to come down on the cost of tuition and fees or else the schools would close.

Agreed. I am a supporter of ron paul, and as long as it was done cleanly, I support massive reduction in student loan programs. Costs for college tuition would probably fall DRASTICALLY.

Student loan programs represent a massive distortion of incentives for the economy as a whole, which unfortunately are long lasting and have a large impact on future generations compared to other misaligned incentives

 

[bacillus1]

Ron Paul is right. If student loans were abolished, then they would have to come down on the cost of tuition and fees or else the schools would close.

But then the private loans come in, and people would just borrow from those. So schools will still get their revenue.

 

[a runner]

Ron Paul is right. If student loans were abolished, then they would have to come down on the cost of tuition and fees or else the schools would close.

Yeah, so you may end up paying a bit higher interest rates, but you'd have less than half the debt because tuition would be way down. Not only that but your degree would actually mean something because far less people would have it. I'd say that's a good deal.

 

[PharmDstudent]

But then the private loans come in, and people would just borrow from those. So schools will still get their revenue.

And btw, dont vote for ron paul then, because he wants to eliminate ALL student loans

note key word

 

[PharmEcon]

But then the private loans come in, and people would just borrow from those. So schools will still get their revenue.

Private companies are more risk averse in this situation because they aren't acting on ideology, but on reality and the profit-motive. They aren't going to give 100k to a kid who wants to major in roman architecture when he has no chance of getting a job after graduation and will likely never pay back the loan in time.

Also, we are in a period of reduced credit availability as is. When the major banks aren't lending to legitimate businesses (partly due to foolish Fed policies such as paying interest on reserves), they are not going to lend to students. If they did, Bernanke and company might actually be intrigued and push it themselves.

 

[a runner]

But then the private loans come in, and people would just borrow from those. So schools will still get their revenue.

But private loans you actually have to qualify for, unlike government loans. And students would need a co-signer, unless they worked a full time job while going to school and had good credit. Not to mention, how many would still be willing to take out $40k/year in tution for these new pharmacy schools if their interest rate was gonna be 15% instead of 6.8?? The higher the loan amounts, the higher the risk for the bank, and the higher the interest rate they would charge. It'd be good for the pharmacy profession.

 

[type b pharmD]

note key word

I think he wanted to eliminate only government sponsored loans (not the existence of all loans). But this is just semantics (perhaps I shouldnt have said all, but, the fact that 95% of student loans are govt loans, it is pretty much all). Private loans would obviously not even begin to make up the difference, so the tuition would fall, schools would close, etc. Ron Paul is basically a badass, which is pretty cool given that he is 75 years old

 

[a runner]

I think he wanted to eliminate only government sponsored loans (not the existence of all loans). But this is just semantics. Private loans would obviously not even begin to make up the difference, so the tuition would fall, schools would close, etc. Ron Paul is basically a badass, which is pretty cool given that he is 75 years old

Totally agree, and I'm pleased to find so much support for his ideas here.

As to the confusion about private student loans. I believe in a free market approach that Dr. Paul advocates, there would be no more private student loans either. You would just take out a regular loan to pay for school, just like any other loan. The loan wouldn't have privileged protection anymore just because it was taken out for school (in other words it could be discharged in bankruptcy). It would be treated like any other loan, and subject to the same standards of approval.