5 replies to this topic

[redFishBlueFish]

http://www.rollingst...e-debt-20140820

 

Have a read. The point the article doesn't touch is the repayment rate. This is how these douchebag companies get you. The start your repayment is at a fair affordable rate, not talking APR, but the amount they required. After a year or paying off your first loan of many, they jump it up to $800 to $1,000! Seriously? Why not span the loan a few more years and help these students out? Car payment level of payment can easily be managed, but no one in Washington DC has even ever looked at repayment limits.

[tunt01]

re: repayment

 

These loans are termed amortizing loans, in that they should have the same consistent payment amount with components of interest and principal repayment varying as a percentage of that same consistent total payment figure over time.  If your repayment (principal) is increasing, your interest expense component should be decreasing accordingly.

 

re: Warren

 

This senator is the epitome of unbridled liberal idealism with little regard for economic risk, costs or long-term consequences.  I think she is extremely dangerous.  The very notion that the US government should price the risk (borrowing rate) of students at the same rate the Federal Reserve lends money to Bank of America is positively insane.  It's that kind of mentality that fostered an environment for "free money" to go buy houses in the '05-'07 timeframe.

 

However, I don't see anything wrong with being able to refinance this debt

 

 

 

 

Edited by prophets, 22 August 2014 - 04:43 AM.

[redFishBlueFish]

 

However, I don't see anything wrong with being able to refinance this debt

 

Exactly. I received a letter in the mail stating I could refinance at 35% APR.... LOL 

[tunt01]

 

Exactly. I received a letter in the mail stating I could refinance at 35% APR.... LOL 

 

 

At that rate, the loan is probably not a government loan, but a private loan from a private institution.

[redFishBlueFish]

 

 

Exactly. I received a letter in the mail stating I could refinance at 35% APR.... LOL 

 

 

At that rate, the loan is probably not a government loan, but a private loan from a private institution.

 

 

I understand, it's just one example "the market" is gouging students in hopes of a manageable repayment program. If you aren't willing to do out of control APRs, you have to have the credit. Well... being in debt as much as you make a year knocks your credit as well. It's fab-u-lous.

[tunt01]

 

I understand, it's just one example "the market" is gouging students in hopes of a manageable repayment program. If you aren't willing to do out of control APRs, you have to have the credit. Well... being in debt as much as you make a year knocks your credit as well. It's fab-u-lous.

 

 

I sympathize with your predicament of being in debt.  However, there is a difference between government programs which underprice the costs of debt (interest rate) as a tool of social policy and a true market between borrowers and lenders.  A lot of what Warren is trying to do is related to government sponsored student loans, not private market loans like yours.