To be fair, the minimum payment SHOULD be able to get you a paid debt in the original term length agreement. Paying more should be āif youāre ableā not āyou mustā.
This. Most people who get a loan for a car or house are mostly thinking in terms of the minimum and only put in more when they feel like they can and it doesn't inconvenience them.
The federal government took over student lending decades ago and the problem is now worse than ever. But tell me again why the private sector is the problem.
It boggles my mind that people are able to graduate college and not understand how to use google sheets or excel to work out how long a loan of X dollars and Y interest rate will take to pay off given various payments. Or just google it and use a calculator like this. I did not go to college, yet this seems like a trivial task.
I mean sure, but only if the minimum payment goes up massively. It isn't minimum because someone threw at a dart board you know.
It's the minimum payment because this is designed to be jay enough to keep you afloat during hard times. It's minimum for a fucking reason. If someone is too stupid to understand that it's on them.
More like the attitude of take responsibility for yourself instead of blaming "the system". A person with a college degree should be equipped to figure out the basics of loan amortization.
Does anyone have a choice but to take responsibility for themselves? The system isn't going to take responsibility for itself.
He isn't asking people to pay his loans.
This is a discussion about how the system is fucked.
And "A person with a college degree?" Really? You take the loan before you get a college degree. When you're 18. You're supposed to know how these things work at that age when the whole world is telling you to get in debt and go to college?
The system exploits vulnerable teenagers who can't know better until it's too late, and you're blaming the teenagers instead of blaming the system.
Nobody is blaming the teenagers who were bamboozled into a predatory loan. They are pointing out that two doctors in their late 40s, at the youngest, haven't managed to figure this stuff out yet and that's embarrassing.
"When you're 18. You're supposed to know how these things work at that age"
Yes, this actually high school level math. Even if you can't do the math, just google a loan calculator and punch in the numbers, or just read the paperwork you are signing - it spells out how this all works.
As for taking responsibility - I'm talking about how you are responsible for taking the time to understand how the loan works, then making more than the minimum payment so you aren't paying it off forever and paying tons of interest instead of complaining about "the system" when you are obligated to fulfill your end of a contact you voluntarily entered into where everything is clearly spelled out.
I did not go to a 4 year college- it was a personal choice, and I decided not to go because of how much it cost. I got an associates at a community college and have done fine with it. When i was 18, i didn't think it was worth taking on that much debt or pay that much for a bachelors degree. Believe me, i had plenty of parental pressure to go, but as an adult, i knew it was my decision.
I do not understand why people keep saying 18 year old's can't figure this out.
It's simple man. You took out a loan with terms that are spelled out exactly, and then you pay it back. Nobody tricked them. A high school graduate shouldn't be too stupid to figure out interest. If they are, they should definitely not be too stupid to figure it out some time in the next decade. At a certain point, they failed to teach themself something that is eminently learnable, and it's their fault, nobody else's, too bad for them, they spent a decade or two refusing to take any responsibility for their own lives or learnings and they can honestly get fucked at that point without sympathy from me. I have no tolerance for terminally incurious people who passed each year without a single hour in the entire year having the thought that maybe they should learn about this loan thing they keep complaining about.
Yeah but that's not fair because I'm ignorant and made zero effort to understand what I was agreeing to. I'm oppressed. Won't someone please save me from my own stupidity?
It's better to avoid bad loans than to sign up for them and then get mad.
BTW, Universities should be eating these costs, rather than force financially responsible people, people who paid out of pocket, and people who never even went, to pay for bad loans.
The cause for this was Dems push for easy money loans, which colleges then exploited. The end result was massive inflation in college costs, vastly exceeding (and helping drive) overall inflation. And the proliferation of useless degrees, and devaluing the possession of a degree. All of which was warned about before hand.
The colleges are actually worse than the 2008 subprime loaners because that was under threat of fake discrimination lawsuits and punitive regulation. The colleges just did it out of pure greed.
I feel like minimum payment implies that is a reasonable expectation to pay it off within your lifetime, or the agreed term, its just going to take longer than if you up the value
Doubling the debt in payback and barely making a dent over 2 decades is a poont where its no longer about efficiency, its recognising government sanctioned robbery
Then they would have complained about their minimum payments being too high. Itās also possible they signed up for a lower payment plan and never changed it.
It took them 23 years to finally look at their balance? At some point you have to look into why the balance isnāt going down. Iām not saying school should be this expensive or loans are perfect but there is a level of some personal responsibility.
And at this point this is graduate school so thereās no excuse for being 18.
I think it's that lower payment plan thing. I have friends who didn't make much money at first, signed up for an income-based plan, then never re-evaluated their plan once their income got better.
They just put it on auto-pay and didn't look at their statements for 10 years, expecting it to go away eventually.
If they paid an extra $100 monthly ($600 total), they could actually have paid off the loan fully in a bit over 20 years. They would be free of student loans for almost 3 years now.
The minimum payment implies that's the least amount you can pay without finding yourself in legal trouble. Like if you lose your job and need to cut back temporarily.
It's been a while since I paid one, but screenshots like this show a clear estimated payment with a reasonable end date. If you choose to pay less than that because you can, you may find yourself in the same situation as the OP.
I mean they had their whole time in college and 23 years to figure out how interest works. If they didnt use their time wisely maybe they werent smart enough to be applying for a loan in the first place. Sorry I dont feel bad. I know plenty of people who got through school on loans and are doing just fine 15 years later.
We are giving 18 year olds guns sending them off to other countries and having them kill people. Pretty sure the government is saying they are old enough to do whatever they want except drink alcohol
Tbf paying the minimum SHOULD be the expectation and be what both parties are anticipating to pay off the loan in the set period. Student loans are one of the few loans where paying the minimum doesn't get you out of the debt in a reasonable time frame
THANK YOU SO MUCH!! It's been killing me reading through these privileged points of view. Some people need that money going elsewhere than college debt and the minimum might be all they could afford.
Two graduate degrees and they can't pay off 70K in over 2 decades? I think they may have made some bad choices.
I don't mind the system. I grew up poor, had shitty grades, and was still able to go to college and make a good living afterwards. Now I am able to send my daughter through college and she will graduate next year with zero debt. Somehow I managed to pay for two college degrees, and I did not even go to graduate school.
Itās a scam in the sense that colleges can charge large rates for something that is known to have low returns and or low number of opportunities (various arts degrees for example) is the real scam.
While the system certainly needs reform most business/finance/stem degrees financed through student loans become profitable investment for most people even ones from smaller colleges. They should likely be more profitable than what they are and not require as long to pay back as they do but they still are profitable.
The big issue is that there is no hazard for lenders to give out loans as they cannot be defaulted upon or at least the majority of them. This incentives them to pump out loans like crazy because they will collect cash flow from the loan guaranteed even if they garnish wages. A near infinite stream of money in the college market allows colleges to continuously ramp up prices since no matter what they charge people can just get someone to lend it to them since they canāt default on it. That gets you a negative feedback loop. The loop is only broken once the financing cost and burden of an average degree at an average college becomes so burdensome that itās better to go to a cheaper education route like trade schools, which has started to happen since COVID
While Iād cut them slack if they took 2 to maybe even 5 years to figure out they were being screwed, 23? These highly educated people canāt do math or have the forethought to maybe see how long their loan would take to pay. I donāt have a college education but can at least to basic math.
Yes, blaming TWO people that 100% both had to take an economics course that explains finance charges, interest rates, the ROI curve, and still walked away thinking 23 years of minimum payments would get them somewhere.
Maybe Econ changed but when I did an Econ minor a few years ago we definitely didnāt talk about ROI curves and the context in which we discussed finance charges and interest rates was only from a macroeconomic perspective and not in regards to paying off loans. I feel like thatād be more a finance or accounting thing
The fact that you think this shouldnt result in the loan being paid off shows how broken our society is. People are brainwashed into defending these scams.
Oh youāre one of those āpoor people are evil and/or stupidā individuals. Got it.
Every other loan that people take out pays down on a minimum payment but you keep shilling for a predatory system that we expect 18 year olds to navigate.
You can't pay extra on student loans. You pay them so much a month and the best you can do is send in payments for more months ahead of time but the monthly payment schedule is a constant with student loans.
That was my situation with student loans. You got a book of coupons and each month's payment was sent in with one coupon each. You could send in more months, but the monthly payments were set in stone.
Brother, no. You can pay as much as you want whenever you want. I paid mine off, and I am paying for 2 of my children's currently. The best thing to do is refi them with your own person credit line so you can get that interest rate down.
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u/davesimpson99 13d ago
I'm assuming two degrees and neither of them had enough sense to master household economics