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this post was submitted on 01 May 2024
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A Boring Dystopia
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You can't do this with student loan debt which seems incredibly dumb. I also don't understand borrowing 100k for school.
It’s not the original loan amount. The trap in student loans is the initial deferment when they gain interest while you aren’t paying and taking classes for 4-6 years. One of my loans was 14k and when I graduated had more than doubled. By the time it was paid off in my 30s the total sum I had paid in to interest was over 100k. And I was paying on an accelerated cycle for the last 5 or so years to kill it faster.
I had discovered with one of my servicers that they were applying my overpayment only to interest as well so the principal would not go down and keep generating new interest. This is actually illegal now thankfully
Wow Americans start accruing interest on student loans while you're still in school?? That's crazy.
Yeah. There are two kinds of loan as part of the federal loan program. Subsidized and unsubsidized. You get granted a pool of loans from both kinds when you apply for aid. The unsubsidized loans accrue interest the whole time. The subsidized loans are equally horrifying mostly because the interest is accruing, it’s just being paid for by the taxpayers on your behalf. Neither public loan actually accrues no interest while you are in school
The insidious part is this is all sold to you at 16-18 by your own student advisors and the university as “financial aid”
Other than the fact that college tuition has become absurdly expensive, the predatory fees and interest structures of student loans means that most people who have been paying theirs to the best of their ability for several years actually still owe MORE than the original amount borrowed, which I'm guessing is the case here.
The terms and conditions that people who are usually 17-18yo and know fuck all about contract law are coerced into agreeing to in order to "ever make something of themselves" would make Franz Kafka disown The Trial for being utopian sentimentalism in comparison.
Are in-state tuitions not a thing anymore? I'm old but when I went to school it was the difference between something like $30k a year and $5k a year.
Edit: for one local major university in a kinda shitty state (but a good school), I guess now it's 10k/year vs 30k/year
Also, how many 17-18yos are deciding on this stuff without parents' help?? I mean, clearly not all, but surely most?
My parent encouraged me to take out loans including housing, then overcharged me rent from it lol
Not all parents are helpful
State university in my city is 10k a year
Stop lyin
Most 4-year universities in the US average around $15k after federal aid, plus rent in a city like Boston or Atlanta will probably cost you a lot more than $15k per year, not including cost of living. Interest rates for student loans can range between 4% and 17% monthly. $100,000 is a little high but very realistic.
Which part of "most people who have been paying theirs to the best of their ability for several years actually still owe MORE than the original amount borrowed" didn't you understand?
10k/y for 4 years comes out to 40k and it's not at all unusual for people to end up owing 2.5 times the original amount or more in spite of doing the literal best they can to pay it off. That's how awful the terms and conditions of student loans are.
You're thinking of bankruptcy, you can absolutely stop paying student loans, you'll still owe them but they can't force you to pay them.
They sure as fucking hell can garnish your wages.
I’d love a little extra on top of my wages. I just hope it’s not parsley.
https://studentaid.gov/help-center/answers/article/what-is-wage-garnishment
You might try reading up on it (or the link someone posted) as you've got it wrong. That's why this has been such a huge issue, they are unlike other loans.