Student Debt Crisis http://studentdebtcrisis.org Your One Stop Hub For Student Debt Issues Thu, 03 Sep 2015 19:08:19 +0000 en-US hourly 1 Rep. John Kline to Retire | #FlipADistrict http://studentdebtcrisis.org/kline-to-retire/ http://studentdebtcrisis.org/kline-to-retire/#comments Thu, 03 Sep 2015 18:28:58 +0000 http://studentdebtcrisis.org/?p=3398 Last September, Student Debt Crisis successfully nominated Rep. John Kline to Bill Maher’s #FlipADistrict Competition. Kline was chosen as America’s “Worst Congressman” and a campaign to flip his district followed. Today, one year later (almost to the date), Rep John Kline has announced that he will not seek reelection. On top of that, efforts to #FlipADistrict may prove successful as the Minnesota Star Tribune notes:

“The district is changing and may be trending to the DFL [Democratic Party in Minnesota’s 2nd District], as President Obama won a majority of votes in 2012. The DFL have two candidates considered serious.”

Rep. Kline refused to consider the Student Loan Forgiveness Act, which had over 1 million petition signers, and has accepted more contributions from for-profit universities than any other politician in America.

“Kline didn’t just oppose the Student Loan Forgiveness Act, he actually wrote a bill to reduce the budget deficit by raising rates on student loans,” said Maher on his hit HBO series Real Time with Bill Maher. We agreed and responded, “he needs to be removed from office so that America can start to really solve our student loan crisis.”

Today is a victory for everyone who is interested in seeing progress in America’s higher education policies. We are looking forward to positive movement in the future without Rep. Kline’s influence.

 

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Why Small Student Debt Can Mean Big Problems http://studentdebtcrisis.org/small-debt-mean-big-problems/ http://studentdebtcrisis.org/small-debt-mean-big-problems/#comments Wed, 02 Sep 2015 17:02:34 +0000 http://studentdebtcrisis.org/?p=3394 Politicians who complain about college costs frequently cite two numbers: 1 trillion and 7 million. Student borrowers owe more than $1 trillion, and 7 million borrowers are in default, according to the latest Education Department data.

It’s natural to connect the two facts with a causal arrow, that more debt leads to more default. But the reality is surprising: Borrowers who owe the most are least likely to default.

The reason for this pattern? The biggest borrowers tend to become the highest earners.

In particular, borrowing is highest for those who go to graduate school. Forty percent of new loans go to graduate students. Among those earning law and medical degrees in 2012, median debt (undergraduate and graduate school) is $141,000 for lawyers and $162,000 for doctors…

Continue Reading at Dallas News…

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The Unemployment-Enrollment Link http://studentdebtcrisis.org/unemployment-enrollment-link/ http://studentdebtcrisis.org/unemployment-enrollment-link/#comments Thu, 27 Aug 2015 17:03:32 +0000 http://studentdebtcrisis.org/?p=3390 Employment and unemployment rates, much more than the number of high school graduates or other population trends — which are important over time but very slow moving — are the biggest factors driving enrollment for community colleges, for-profit colleges and some open-access four-year institutions.

Selective public and private colleges can control the size of their incoming classes by tinkering with admission criteria, and they tend to draw students whose decision is not whether to attend college but where. But community colleges accept anyone with a high school diploma who wants to enroll, and the size of that potential market varies depending on what the alternatives are.

For low-income students, especially at colleges where tuition is low and often covered by financial aid, the biggest cost of college is the opportunity cost — the money a student could have earned by working instead of going to school…

Continue Reading at Inside Higher Ed…

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‘Free’ vs. ‘Affordable’ Tuition- Presidential Candidates’ Plans Explained http://studentdebtcrisis.org/free-vs-affordable-tuition/ http://studentdebtcrisis.org/free-vs-affordable-tuition/#comments Thu, 27 Aug 2015 16:59:03 +0000 http://studentdebtcrisis.org/?p=3388 As Democrats on the presidential campaign trail pitch their college affordability plans to voters, they are largely united in their calls for a big boost in federal spending on higher education.

Following a monthslong effort by liberal groups to push “debt-free college” — and after President Obama’s call for free community college earlier this year — leading Democratic presidential hopefuls Hillary Clinton and Bernie Sanders both now have proposals that would expand the role of the federal government in higher education.

At the heart of both plans is a new federal-state matching program that would send billions of dollars to states and colleges with the goal of seeing tuition slashed or eliminated at public colleges and universities.

For all the similarities, however, there are key differences in how Clinton and Sanders are approaching college affordability and which types of students their plans would benefit.

Continue Reading at Inside Higher Ed…

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I defaulted on my student loans — here’s how it happened, and how I’m handling it http://studentdebtcrisis.org/defaulted-student-loans-how-im-handling-it/ http://studentdebtcrisis.org/defaulted-student-loans-how-im-handling-it/#comments Thu, 27 Aug 2015 16:56:03 +0000 http://studentdebtcrisis.org/?p=3386 During my sophomore year at Fairleigh Dickinson, my father died of cancer — and I was left to pay for my education, which was about $30,000 a year.

I took out a federal loan and two private loans through Sallie Mae. I also got jobs as a tutor and a gas station attendant, arranging my schedule so that I went to classes two days a week and worked the other five.

It was exhausting and a lot of pressure, but I graduated on time in 1994 — with roughly $60,000 in student loan debt.

The Road to Default … My first job was at a newspaper, making $18,000. It wasn’t much, but I still paid my loans on time. Then, in 2000, my wife was diagnosed with MS, and her employer effectively invented a reason to fire her…

Continue Reading at Business Insider…

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Why Millennials and Boomers Are Adrift In the Same Debt-Filled Boat http://studentdebtcrisis.org/why-millennials-and-boomers-are-adrift-in-the-same-debt-filled-boat/ http://studentdebtcrisis.org/why-millennials-and-boomers-are-adrift-in-the-same-debt-filled-boat/#comments Thu, 27 Aug 2015 16:49:47 +0000 http://studentdebtcrisis.org/?p=3384 NEW YORK (MainStreet) — If Parade Magazine fell out of your Sunday paper—you know Parade, that 16-page shell-of-its-former-glory that makes grocery store circulars look like War and Peace—you would have seen “Millennials vs. Boomers,” a cover story featuring actress Abby Elliott and her father, the actor and comedian Chris “Woogie” Elliott.

You would have read about all the quirky things that make old people charming (they pine for the days when there were only three channels on TV) and the things that make Millennials endearing (they call rosé “French Gatorade”). There’s Chris holding a hardbound world history book standing next to Abby, who holds a MacBook Pro. There’s also the inevitable paragraph about social media. Can you guess what’s not mentioned? How the student debt crisis is a plague on retirement for both Millennials and Boomers. They have more in common than they think, it turns out.

Recent graduates aren’t the only ones who hold student debt. Their parents, who kindly took out loans on their child’s behalf or children’s behalf, are repaying them, too—and a lot closer to their target retirement age than their offspring. There’s a number that’s been floating around for a couple of years, reported by a number of outlets: $8,000—the average education loan debt held by pre-retirees (i.e. parents), up from $600 two decades ago.

Read the Entire Article at The Street…

 

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Should you take out an insurance policy to cover college tuition? http://studentdebtcrisis.org/tuition-insurance/ http://studentdebtcrisis.org/tuition-insurance/#comments Thu, 27 Aug 2015 16:40:21 +0000 http://studentdebtcrisis.org/?p=3382 Before Jackie Niblock sent her only son Ryan off to Virginia Tech this month, she made sure he had all of the snacks and comfy sheets he needed to feel at home in Blacksburg. And for her own comfort, she took out a $50,000 insurance policy that would reimburse Ryan’s college costs if he had to withdraw from school.

For $146.43, Niblock purchased a one-semester policy from Allianz Global Assistance that covers up to 100 percent of tuition and housing costs if Ryan suffers a serious illness, injury or death, and up to 80 percent if he leaves school because of a mental health condition.

“You plan for college from the time they’re little, so the last thing that you want is for something to go wrong and not have that investment protected,” said Niblock, who lives in Richmond.

Continue Reading at Washington Post…

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How The College Pricing And Student Loan Systems Hurt Students http://studentdebtcrisis.org/how-the-college-pricing-and-student-loan-systems-hurt-students/ http://studentdebtcrisis.org/how-the-college-pricing-and-student-loan-systems-hurt-students/#comments Wed, 26 Aug 2015 17:30:17 +0000 http://studentdebtcrisis.org/?p=3378 Joseph Chanlatte’s father was the director of a university when political turmoil forced the family to migrate from Haiti for Brooklyn in the early 1980s. So even though both his parents were college-educated, when it came time for Chanlatte to apply, they weren’t much help with the American education system. On his own, he learned how to fund his schooling, which he began at a two-year junior college and finished at a four-year for-profit university.

He took out the maximum amount he could in federal loans — $64,000 — but, in order to make his final payment in 2007, his senior year, he took out one additional loan, a private one, for $10,000.

I assumed the terms were the same as the federal loans,” he said. That mistake turned into what he calls his “financial prison.” Private loans offer worse terms than federal loans. Even if the interest rate is lower than the federal one, it is usually variable, wreaking havoc on a budget. The interest on Chanlatte’s $10,000 loan ballooned so much that, at one point, the balance was $19,000. In 2009 after he relocated to a new city, he was unemployed for about half a year and deferred his payments. “During that time, they did these capitalized interests that they kept adding onto the loan,” he said — $5,816.29 from March 5, 2009 to November 10, 2009. After he complained to the Federal Trade Commission and the Consumer Financial Protection Bureau, the interest rate, which at one point hit 16.3%, suddenly became a fixed rate of 12.25%.

Continue Reading at Forbes…

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Private Colleges Are Offering Record Tuition Discounts to Win Students http://studentdebtcrisis.org/private-colleges-are-offering-record-tuition-discounts-to-win-students/ http://studentdebtcrisis.org/private-colleges-are-offering-record-tuition-discounts-to-win-students/#comments Wed, 26 Aug 2015 17:09:20 +0000 http://studentdebtcrisis.org/?p=3376 Where to find the biggest bargains.

Those scarily high tuition prices most private colleges say they charge are increasingly as make-believe as Freddy Krueger: Only 11% of freshmen paid them last year, according to a survey of private colleges released today.

The rest—89% of freshmen at private colleges—received a school grant or scholarship worth, on average, 54% of the published or “sticker” tuition, the National Association of College and University Business Officers reported. Both those numbers are all-time records.

The survey indicates that colleges eager to recruit applicants are luring students with big grants— often labeled “merit scholarships” to flatter recipients, but in reality more like the discounts off of a retailer’s price tag.

Continue Reading at TIME…

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Tennessee Students Start Classes Under Tuition-Free College Program http://studentdebtcrisis.org/tennessee-students-start-classes-under-tuition-free-college-program/ http://studentdebtcrisis.org/tennessee-students-start-classes-under-tuition-free-college-program/#comments Wed, 26 Aug 2015 16:54:03 +0000 http://studentdebtcrisis.org/?p=3373 This week, an expected 18,000 students—or nearly 1 in 4 recent high school graduates—in Tennessee will begin classes under a new state program that offers two years of free tuition at a state community or technical college.

Nearly 80 percent of the state’s 74,000 high school graduates applied for the Tennessee Promise scholarship, according to the Associated Press.

The scholarship provides tuition and fees not covered by the Pell grant, the state HOPE scholarship, or state student assistance funds. Mike Krause, the Tennessee Promise executive director, told the Tennessean that the process for applying for federal student aid is confusing and may have served as a barrier for some students. “There’s no doubt we need to continue to push for a simplified process,” he said. Of the 58,000 high school seniors that applied for the scholarship, about 31,500 filed the Free Application for Federal Student Aid forms.

Continue Reading at EdWeek…

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