So what's the scam with student loans?

For about the last 20 years, "banks" have been loaning billions of dollars to people with no collateral for degrees that guarantee a minimum wage job.

The people distributing the loans aren't stupid, but rather wickedly ingenius. So how are they getting their money back? Insurance? Derivitives? Indoctrination of the masses?

I know there is a scam going on. I've been doing some research lately and was wondering if anyone had some info or suggestions to investigate.

Thanks.

Part of it, is student loans cannot be discharged in a bankruptcy, if I understand it correctly.

i was unaware myself, my wife, a brother-in-law, 2 brothers, and 3 sisters were working for minimum wage. i guess we didn't get the memo. :oo-->

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Originally Posted by MNeagle

Part of it, is student loans cannot be discharged in a bankruptcy, if I understand it correctly.

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Student loans cannot be discharged in a bankruptcy, however, I am sure that there are some very rare exceptions to this rule. Student loans will follow a student until they are completely paid off. Since student loan balances are getting much bigger (some into the $100,000 range or higher) with the increase in college tuition, then these student loans can follow a student for the rest of their lives. I could be wrong on this but I think that since the student loans are backed by the gov't is the reason why student loans cannot be discharged in a bankruptcy.

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Originally Posted by chad

i was unaware myself, my wife, a brother-in-law, 2 brothers, and 3 sisters were working for minimum wage. i guess we didn't get the memo. :oo-->

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Wow, aren't you overly defensive today. ;D I didn't mean everyone, but come on, there was a story about a woman in debt $100,000 dollars with a degree in Womens Studies. There is a lot of that happening.

Anyway, with the economy tanking, defaults are going to go through the roof. It'll be like getting blood from an unemployed stone. They plan on getting their money somehow.

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Originally Posted by RJB

For about the last 20 years, "banks" have been loaning billions of dollars to people with no collateral for degrees that guarantee a minimum wage job.

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I was unaware of any such "guarantee" - in this economy, even a minimum wage job would be welcomed by many with college degrees! ;)

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Originally Posted by RJB

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Originally Posted by chad

i was unaware myself, my wife, a brother-in-law, 2 brothers, and 3 sisters were working for minimum wage. i guess we didn't get the memo. :oo-->

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Wow, aren't you overly defensive today. ;D I didn't mean everyone, but come on, there was a story about a woman in debt $100,000 dollars with a degree in Womens Studies. There is a lot of that happening.

Anyway, with the economy tanking, defaults are going to go through the roof. It'll be like getting blood from an unemployed stone. They plan on getting their money somehow.

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With more student loans getting in the 6-figure range, then the old saying of "Nothing is certain but death and taxes" will soon be replaced with the 21st century saying of........................."Nothing is certain but death, taxes, and student loans".

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Originally Posted by RJB

So how are they getting their money back?

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Federally-insured Student Loans can NEVER be subject to Bankruptcy. Never. On the hook forever. Forever.

:o

I went to culinary school right after high school (I was young, naïve, and a communist), paid $45,000 for a good ol' guberment loan and ended up at a dead end minimum wage job. You'd be shocked how many people fall for this trap, every single person at the culinary school I went to fell for it, and restaurants loved it since they'd get highly trained white kids to work for minimum wage, yet not last long enough for a raise, due to the fact you actually have to work (I mainly quit due to my business and a severe skin condition I had, I ended up making a decent wage since I got very good.) I actually survived a long time compared to most: The worst was the culinary students who went to CIA (Culinary Institute of America), and took out loans for $150,000, no joke. They started cooking, then quit after 2-3 months, preferring to go to work as a waiter. Most of the wait staff were ex-cooks who were in 10s to 100s of thousands of dollars of debt, (this is how all high end restaurants are run with white cooks.)

Took me a while, but when I started figuring it out, I ended up posting here. :P

My small business thankfully has allowed me to pay off most of my debt. I'll never do anything like that again. I always was so trusting an naïve when I was young, but now I know better.

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Originally Posted by RJB

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Originally Posted by chad

i was unaware myself, my wife, a brother-in-law, 2 brothers, and 3 sisters were working for minimum wage. i guess we didn't get the memo. :oo-->

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Wow, aren't you overly defensive today. ;D I didn't mean everyone, but come on, there was a story about a woman in debt $100,000 dollars with a degree in Womens Studies. There is a lot of that happening.

Anyway, with the economy tanking, defaults are going to go through the roof. It'll be like getting blood from an unemployed stone. They plan on getting their money somehow.

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alright, alright. ;D

I have a master's degree, and I put it to good use. Right now I bill between $100 and $150 per hour for my work. Yeah, I have student loans, but I at least got a degree where I can make some money out of it.

madfranks, I only know 3 fields where this can be done: lawyer, doctor and computer / IT consultant. am i close?

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Originally Posted by FreeEnergy

madfranks, I only know 3 fields where this can be done: lawyer, doctor and computer / IT consultant. am i close?

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You forgot Registered Bonded Certified Sexologist.... :D

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Originally Posted by Shami-Amourae

I went to culinary school right after high school (I was young, naïve, and a communist), paid $45,000 for a good ol' guberment loan and ended up at a dead end minimum wage job. You'd be shocked how many people fall for this trap, every single person at the culinary school I went to fell for it, and restaurants loved it since they'd get highly trained white kids to work for minimum wage, yet not last long enough for a raise, due to the fact you actually have to work (I mainly quit due to my business and a severe skin condition I had, I ended up making a decent wage since I got very good.) I actually survived a long time compared to most: The worst was the culinary students who went to CIA (Culinary Institute of America), and took out loans for $150,000, no joke. They started cooking, then quit after 2-3 months, preferring to go to work as a waiter. Most of the wait staff were ex-cooks who were in 10s to 100s of thousands of dollars of debt, (this is how all high end restaurants are run with white cooks.)

Took me a while, but when I started figuring it out, I ended up posting here. :P

My small business thankfully has allowed me to pay off most of my debt. I'll never do anything like that again. I always was so trusting an naïve when I was young, but now I know better.

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I did similar to the same thing, though went to culinary school a couple years after highschool, having attempted to pursue a "real" education first.

I bailed half way through when they wanted me to renew my student loan for the next semester. I couldnt justify another 7.5k in loans as the market had started to really turn and all the jobs were going the way of the dodo. With no prospects in sight I left school and wisley as well, since nearly all my friends that stayed wound up 50k in debt and couldnt get work anywhere, or as you said, wound up making 8.50 an hour at a Denny's.

However, the same goes for those of my friends that stayed in real college as well. I can count three fingers how many actualy have a decent income at this point, and even fewer who arent still with their parents or just barley under the cusp of "getting by" like my wife and I are.

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Originally Posted by FreeEnergy

madfranks, I only know 3 fields where this can be done: lawyer, doctor and computer / IT consultant. am i close?

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Nope; I'm an architect. I'm highly efficient in my work and maximize my use of technology to get as much done myself as an average staff of four could do. So even billing at that rate I give my clients a better price than most other people or firms could offer.

THE Architect? :morph:

Ok, I didn't think architects could earn that much in this market. So, apparently, it aint all a total collapse.

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Originally Posted by madfranks

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Originally Posted by FreeEnergy

madfranks, I only know 3 fields where this can be done: lawyer, doctor and computer / IT consultant. am i close?

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Nope; I'm an architect. I'm highly efficient in my work and maximize my use of technology to get as much done myself as an average staff of four could do. So even billing at that rate I give my clients a better price than most other people or firms could offer.

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MadFranks,
as an architect, can you answer a generic type question for me?

Back in '68 I used a magazine floor plan spotted in a magazine that I tore out and then found a general contractor. I gave the floorplan article to my builder, who took them to his resource, who he called "a part-timer student" of some type who turned them into blueprints and elevations. This was all back before computers were doing all the CAD/CAM stuff.

I'm itching to build on a piece of property we own, and would like to find some kind of "drawing person" that charges less than highly technical architects like you are legitimately charging, to get a set of blue prints and elevations so that I can have something to take to my podunk city planning commission and apply for permits, etc.

Where do lower middle class people like us go to find one of these drawing type part-timers? Any suggestions would be appreciated.

beefsteak

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Originally Posted by FreeEnergy

THE Architect? :morph:

Ok, I didn't think architects could earn that much in this market. So, apparently, it aint all a total collapse.

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I ran into a punk-kid who said his dad was an architect. Me and some friends ran into him at party. The kid was a total prick, thought he was a big guy cuz his dad was rich. He later invited us to his house. Man, it was freaking huge and fancy. Even had a water fountain in the lobby. Anyway, turns out the kid invited us over cuz he wanted to get with one of the girls in my group. lol, she gave it up too!

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Originally Posted by 1970 silver art

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Originally Posted by MNeagle

Part of it, is student loans cannot be discharged in a bankruptcy, if I understand it correctly.

---

Student loans cannot be discharged in a bankruptcy, however, I am sure that there are some very rare exceptions to this rule. Student loans will follow a student until they are completely paid off. Since student loan balances are getting much bigger (some into the $100,000 range or higher) with the increase in college tuition, then these student loans can follow a student for the rest of their lives. I could be wrong on this but I think that since the student loans are backed by the gov't is the reason why student loans cannot be discharged in a bankruptcy.

---

SLs never disappear, go away, or are forgiven.

Yes, b/c the gov sponsors them they cannot be dishcarged b/c of bankruptcy.

Some people who just reached Social Security recipient age realized that the US gov is garnishing their social security monthy payments because they still ow (or stopped paying) their student loan.

There have been articles on this recently and I'm sure they can be found on google.

For the younger generation that is graduating with an average debt of $24,000 this will have repercussions, as the job market is so weak.

Same for vocational schools and the culinary schools noted in this thread.

Sadly, education in the US has become a business. The education industrial complex (as Celente says).


Unis and vocational/trade schools know federal FAFSA money is available for students to borrow --> schools raise tuition --> the gov raises the debt the students can borrow because of the rise in tuition --> and so on, and so on.

I went to a state public Uni in the late 80s and early 90s. Tuition was pretty cheap, and my parents helped me with rent, and I usually worked a job like making sub sandwhiches and the like during the school year and construction in the Summer.

I gradudated with $0 SL debt, or any debt. I was lucky. (I also abhor debt.)

I am basically debt free now - except - ding! ding! for a student Loan I took out 7 years ago when I started an MA program but quit after one quarter because the cost to benefit return being low (field: education).

I still have $50 usd taked out of my saving account on an automatic withdrawal to cover the $4,800 I borrowed at 4% 7 years ago.

Stupid to keep the loan? Yes. But it keeps my credit current, as I'm living in Vietnam and have not filed for taxes in 8-9 years.

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Originally Posted by cthulu

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Originally Posted by FreeEnergy

THE Architect? :morph:

Ok, I didn't think architects could earn that much in this market. So, apparently, it aint all a total collapse.

---

I ran into a punk-kid who said his dad was an architect. Me and some friends ran into him at party. The kid was a total prick, thought he was a big guy cuz his dad was rich. He later invited us to his house. Man, it was freaking huge and fancy. Even had a water fountain in the lobby. Anyway, turns out the kid invited us over cuz he wanted to get with one of the girls in my group. lol, she gave it up too!

---

Turns out the producers in our economy produce people that are capable of reproduction? I didn't have anything like this when I was a kid, but if I did I would have had as much fun as possible. It sucks to be the poor kid when all the rich kids have nice houses. You go to their house and party.

How old are you? Keep stacking them coins.

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Originally Posted by Mouse

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Originally Posted by cthulu

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Originally Posted by FreeEnergy

THE Architect? :morph:

Ok, I didn't think architects could earn that much in this market. So, apparently, it aint all a total collapse.

---

I ran into a punk-kid who said his dad was an architect. Me and some friends ran into him at party. The kid was a total prick, thought he was a big guy cuz his dad was rich. He later invited us to his house. Man, it was freaking huge and fancy. Even had a water fountain in the lobby. Anyway, turns out the kid invited us over cuz he wanted to get with one of the girls in my group. lol, she gave it up too!

---

Turns out the producers in our economy produce people that are capable of reproduction? I didn't have anything like this when I was a kid, but if I did I would have had as much fun as possible. It sucks to be the poor kid when all the rich kids have nice houses. You go to their house and party.

How old are you? Keep stacking them coins.

---

lol, I'm 35. This happened about 10 years ago, but the kid was a few years younger than me. I was probably one of the older in the group. When I was a kid, I was friends with a pretty well-to-do family. They'd invite me over for swims and to play with their son, but I always felt out of place. I remember spending the night one time, and they served chili dogs. I felt ashamed my paper plate was smeared with chili sauce, but everyone else's was pristine. The only reason I even came over was to play their son's atari....lol, kids. I don't want to be fancy rich. I'd rather be humble, live a simple life, and be nondescript.

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Originally Posted by cthulu

Quote:

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Originally Posted by Mouse

Quote:

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Originally Posted by cthulu

Quote:

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Originally Posted by FreeEnergy

THE Architect? :morph:

Ok, I didn't think architects could earn that much in this market. So, apparently, it aint all a total collapse.

---

I ran into a punk-kid who said his dad was an architect. Me and some friends ran into him at party. The kid was a total prick, thought he was a big guy cuz his dad was rich. He later invited us to his house. Man, it was freaking huge and fancy. Even had a water fountain in the lobby. Anyway, turns out the kid invited us over cuz he wanted to get with one of the girls in my group. lol, she gave it up too!

---

Turns out the producers in our economy produce people that are capable of reproduction? I didn't have anything like this when I was a kid, but if I did I would have had as much fun as possible. It sucks to be the poor kid when all the rich kids have nice houses. You go to their house and party.

How old are you? Keep stacking them coins.

---

lol, I'm 35. This happened about 10 years ago, but the kid was a few years younger than me. I was probably one of the older in the group. When I was a kid, I was friends with a pretty well-to-do family. They'd invite me over for swims and to play with their son, but I always felt out of place. I remember spending the night one time, and they served chili dogs. I felt ashamed my paper plate was smeared with chili sauce, but everyone else's was pristine. The only reason I even came over was to play their son's atari....lol, kids. I don't want to be fancy rich. I'd rather be humble, live a simple life, and be nondescript.

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There is nothing wrong with living a simple life. Living a simple life is the best way to live life IMO.

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Originally Posted by Still Barbaro

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Originally Posted by 1970 silver art

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Originally Posted by MNeagle

Part of it, is student loans cannot be discharged in a bankruptcy, if I understand it correctly.

---

Student loans cannot be discharged in a bankruptcy, however, I am sure that there are some very rare exceptions to this rule. Student loans will follow a student until they are completely paid off. Since student loan balances are getting much bigger (some into the $100,000 range or higher) with the increase in college tuition, then these student loans can follow a student for the rest of their lives. I could be wrong on this but I think that since the student loans are backed by the gov't is the reason why student loans cannot be discharged in a bankruptcy.

---

SLs never disappear, go away, or are forgiven.

Yes, b/c the gov sponsors them they cannot be dishcarged b/c of bankruptcy.

Some people who just reached Social Security recipient age realized that the US gov is garnishing their social security monthy payments because they still ow (or stopped paying) their student loan.

There have been articles on this recently and I'm sure they can be found on google.

For the younger generation that is graduating with an average debt of $24,000 this will have repercussions, as the job market is so weak.

Same for vocational schools and the culinary schools noted in this thread.

Sadly, education in the US has become a business. The education industrial complex (as Celente says).


Unis and vocational/trade schools know federal FAFSA money is available for students to borrow --> schools raise tuition --> the gov raises the debt the students can borrow because of the rise in tuition --> and so on, and so on.

I went to a state public Uni in the late 80s and early 90s. Tuition was pretty cheap, and my parents helped me with rent, and I usually worked a job like making sub sandwhiches and the like during the school year and construction in the Summer.

I gradudated with $0 SL debt, or any debt. I was lucky. (I also abhor debt.)

I am basically debt free now - except - ding! ding! for a student Loan I took out 7 years ago when I started an MA program but quit after one quarter because the cost to benefit return being low (field: education).

I still have $50 usd taked out of my saving account on an automatic withdrawal to cover the $4,800 I borrowed at 4% 7 years ago.

Stupid to keep the loan? Yes. But it keeps my credit current, as I'm living in Vietnam and have not filed for taxes in 8-9 years.

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That is good that you mentioned that because Peter Schiff, on his show yesterday, was talking about gov't involvement in college education (via student loan availability and gov't grants) and how that was raising college tuition. Gov't involvement in anything will raise the cost of that particular good or service.

Just a little add to:
The biggest building boom going on right now is an expansion to universities, medical research labs and remodels of them.
Serious government money is pouring in!

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Originally Posted by Still Barbaro

Some people who just reached Social Security recipient age realized that the US gov is garnishing their social security monthly payments because they still owe (or stopped paying) their student loan.

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http://www.southwestern.edu/studentl...melessness.jpg

True. Student Loans. The debt that keeps on taking. Forever.

:o

for example ... Heald Tech Institute in SF will gladly charge you $20K to learn how to be an electronics tech ... they make money on the loans too ... they feed people info. on how GREAT the job opportunities are for graduates.

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Originally Posted by gunDriller

for example ...

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http://www.youtube.com/watch?v=yJl0XuDKSjc

:D

Those worst off are the people who thought they could make it with a communications degree or a liberal arts degree that cost upwards of $50k. What was the logic that convinced them this was a good idea? ???

Here is a sobering chart:

[img width=600 height=361]http://chronicle.com/blogs/innovations/files/2010/10/underemployment-chart.jpg[/img]

Next time you fly, ask your flight attendant what she got her degree in.

I don't think there is anything but dependency creation going on with the student loans.
Get them young.
12 years of indoctrination has taught them they must go to college right out of high school.
Offer them a loan and they think government is great.
Then once they graduate,many will find their wage is inadequate to meet all their needs.
Since they are now a debt slave they will look to big mommy Govt to take care of them.
Hey big mommy feed me.
Hey big mommy subsidize my rent.
Hey big mommy pay my health insurance.

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Originally Posted by beefsteak

MadFranks,
as an architect, can you answer a generic type question for me?

Back in '68 I used a magazine floor plan spotted in a magazine that I tore out and then found a general contractor. I gave the floorplan article to my builder, who took them to his resource, who he called "a part-timer student" of some type who turned them into blueprints and elevations. This was all back before computers were doing all the CAD/CAM stuff.

I'm itching to build on a piece of property we own, and would like to find some kind of "drawing person" that charges less than highly technical architects like you are legitimately charging, to get a set of blue prints and elevations so that I can have something to take to my podunk city planning commission and apply for permits, etc.

Where do lower middle class people like us go to find one of these drawing type part-timers? Any suggestions would be appreciated.

beefsteak

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I sent you a PM. :)