Just about everyone who leaves college with or without a degree will have some sort of debt accumulation from tuition and housing costs. Unfortunately, those who are not able to make the student loan payments due to living expenses and other costs will face student loan default. What is student loan default? Student loan default is when an individual misses consecutive monthly student loan payments on money that was borrowed for college related expenses such as housing, tuition, and text books. A student loan default can have a serious negative impact on a person's life and future. Here is an explanation of what can happen by not making student loan payments that result in student loan default.
A student loan default can make finding an apartment very difficult. The Internet has made it very easy for landlords to pull an individual's credit report by costing a small fee. The small fee is usually paid by the individual who is seeking an apartment in the form of an application fee; thus, it is not costing the landlord anything. Landlords use a credit report as a helpful indicator whether the prospective tenant will be an on time paying tenant. A student loan default on a credit report indicates to the landlord that the individual is not a reliable person who pays regularly. Thus, the landlord is more inclined to accept another prospective tenant who has a better credit report than someone who has a student loan default listed.
A person's credit card(s) limit(s) will begin to decrease from a student loan default being listed on a credit report. The student loan default that is listed on a credit report will be monitored by credit card companies. The credit card companies will then see the individual as a risk and set in motion the lowering of borrowing privileges. The student loan default listed on a credit report will also make it almost impossible for someone who wants to finance a car or home. If the individual is lucky enough to get a loan for a car or home then he or she will more than likely have an extremely high interest rate.
When an individual has made no effort to resolve the student loan default and make any student loan payments on the amount that is owed is when a loan company will begin to take legal action. This type of debt is usually not allowed to be discharged in a bankruptcy court; therefore, it is a guarantee that it will eventually be paid back whether the person will be able to afford the student loan payments or not. Wage garnishment and the seizing of income tax refund checks are usually the outcome of a student loan default. A wage garnishment is a judicial order that directs an employer to take out a certain percentage of the employee's paycheck. The percentage is then forwarded to the loan company to pay towards the outstanding debt from the student loan default.
full story | Naples Loan | Normal Loans
Surfing The Mets – NY Daily News
Adam Rubin has been the Daily News' Mets beat writer since 2003. He is a Long Island native and author of “Pedro, Carlos and Omar: The Story of as.
p>The Government has joined forces with the Federation of Small Businesses (FSB) to offer up to 10000 graduates a boost to their future employability, through internships in smal.
Conservative author slams Fox News 'cheerleading' tea parties …
O'Reilly responded by equating pervasive Fox News bias with newspapers' editorial pages, usually a properly labeled, set-aside portion of the paper devoted exclusively to opinion. “What's the difference?” he demanded of his guest. …
Banks want to keep students stupid and in debt. A lesson in economics.
Image by Dan Zen via Flickr
The first lesson we learned from the current economic collapse is:
The market does not solve everything. Despite what the neo-cons like Ronald Reagan and George Dubbya told us, turning all state responsibility over to the market means that the entire country is motivated by profit and therefore operates under a value system of greed. This market-first government has not benefited most of us. In fact, it’s only really benefited the super rich, like Reagan and Dubbya.
The second lesson is that a government unduly influenced by the market, by corporations’ and banks’ lobbying and political contributions, will not be able to fulfill its responsibility as regulator of the market.
A case in point: student loans.
The banking industry is lobbying Congress (and to a lesser extent, the American public) to convince us that the current system of student loans is working just fine. Last Thursday, the House passed a bill that would stop giving money to the banks so they can no longer extract wealth from students. The House bill would give money directly to the students.
The banks are trying to convince us that this will be “bad for students” and “end competition” and “cost the US taxpayers more money.” The banks are, of course, lying through their teeth, but again, their motive is profit, not truth.
The truth about student loans is that they became, under the incredibly pro-market policies of Ronald Reagan, a way to extract profit from students. At this point, the average graduating college student is about $24,000 in debt in commercial loans to banks as well as another couple of thousand dollars in credit card debt. That’s because the government student loan subsidies started going to commercial banks (rather than being distributed through Pell grants and other state-run programs) so banks could make a profit off of students and their families.
Some will say: yes, but that college student will earn on average a million dollars more in her lifetime than someone who doesn’t have a degree and therefore it’s “worth it.” But that is, of course, a misrepresentation of what “average” means. Most college grads will not earn huge sums. Some (and probably mostly those who did not take out loans in the first place) will earn spectacular sums. Furthermore, a larger percentage of students who take on loans will drop out and never finish college. Makes sense- you take on loans because you’re poor, you also take on a job or two, have trouble finding a place to live near campus, commute long distances, etc. and not surprisingly, you drop out.
Then there’s the other lie about averages: rich students don’t go into debt for college so the $24,000 is often misleading. Many students are more than $100,000 in debt before they even get their college degree. If they even get their college degree. For some research I was doing on an unrelated topic, I interviewed college students and recent college grads at a state university. Many of them had more than $60,000 in student loan debt. When I asked them about taking on such huge debt loads, they said “I was born in debt. I’ll die in debt. What difference does it make how much debt.” Okay, they weren’t econ or accounting majors, but really? Is that the lesson we’ve taught the next generation?
And imagine starting your life out with this sort of debt burden. According to Jose Garcia of the Demos Organization,
According to the Survey of Consumer Finance, the average debt for families 35 years old and younger in 1989 was $50,000. By 2007, the average debt carried by the same age group doubled to an astounding $100,000.
The recession has certainly not helped. Recent data from the U.S. Education Department shows that the 2008-9 academic year saw a 25 percent increase in the total of student-loan disbursements to $75.1 billion, making it the largest increase in recent memory.
And what if you never even finished that degree or the degree is more or less worthless because it’s from a school with no prestige? So then you get some job that does not pay a livable wage and without health insurance so you can take on even more debt through credit cards. Or when a medical issue comes up your “friends” at the bank will now give you a medical credit loan. And then when you die, heavily in debt, your family can take out a funeral loan. That way the banks can continue to extract wealth from poor Americans though out their lives and afterlives.
Brilliant, for the banks. No wonder they want to keep Americans stupid and in debt. That way the banks keep themselves profitable and in power.
Henry Burt