WOW Fordham COA up to $73k...

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CanadianWolf
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Re: WOW Fordham COA up to $73k...

Postby CanadianWolf » Sat Jun 25, 2011 8:17 pm

Interest rates won't be 29% because nobody would be foolish enough to borrow large sums at that rate. With the return to allowing dischareability of student loan debt would come fewer law schools thus reducing the oversupply of law graduates. Government wouldn't require collateral, but maybe a cosignor.
With loan dischargeability would come lower tuition because money would be harder to get. Just look at what happened in the recent housing market collapse. Easy money made prices soar & lead to a real estate market crash.

scammedhard
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Joined: Mon Apr 18, 2011 1:17 pm

Re: WOW Fordham COA up to $73k...

Postby scammedhard » Sat Jun 25, 2011 10:04 pm

joefow91 wrote:I don't understand how universities charge so much. It's atrocious. Essentially extortion. There should be limits....

If the lemmings keep coming, why rock the boat?

I think the root of the problem is that the under the current system higher education is completely divorced from the product they create. Why should colleges and universities care if their grads can't find jobs? Or if these are also unable to pay their loans back? It's not the problem of colleges and universities anymore. After all, they already got paid upfront and with a no return policy.

Solution: Make colleges and universities share the pain of their students, if there is some. Make them pay a penalty if the grad defaults or extends the loans. Also, as an incentive, give them a bonus if the grad pays back the loan on a timely manner.

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kapital98
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Re: WOW Fordham COA up to $73k...

Postby kapital98 » Sat Jun 25, 2011 10:20 pm

CanadianWolf wrote:Interest rates won't be 29% because nobody would be foolish enough to borrow large sums at that rate. With the return to allowing dischareability of student loan debt would come fewer law schools thus reducing the oversupply of law graduates. Government wouldn't require collateral, but maybe a cosignor.
With loan dischargeability would come lower tuition because money would be harder to get. Just look at what happened in the recent housing market collapse. Easy money made prices soar & lead to a real estate market crash.


This shows an utter disconnect with economic theory.

As risk decreases (loans are discharged) the demand curve will shift outward and more people will take out loans.

The housing market was related to a liquidity trap (a very special case of macroeconomics where expectations no longer shift the market equilibrium for borrowing/lending.) The market for higher education is completely different because all loans are guaranteed by the federal gov't unless a serious credit problem exists. You're analogy has no bearing with reality.

P.S. A cosignor is the same thing as saying "more collateral." They won't accept a cosigner without collateral. The cosigner needs collateral otherwise the purpose of the cosigner, to repay the debt if you fail to, is defeated.




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