The student loan bubble, time to bail out the banks again

[Wreckem]

I think there are several unaccredited law schools in Mass. The case of the 60 some year old lady's 100K law school debt getting discharged comes to mind.

There arent a bunch of unaccredited law schools outside of CA. Yes SNESL got denied accredition by the ABA, it was recommeneded to but denied by the full ABA governing board, but it is accredited by the regional accrediting board, and approved by Mass to granted JDs, which is why Umass is gobbling up. Never go to a new 3rd/4th tier.

Truly fly by night unaccredited schools like Peoples School of Law in CA are dirt cheap. SNESL was a case of not getting accredidation by the ABA and now is the the first public law school in MA as of Fall 2010. It'll get accredited with the UMass name. Sucks for all those suckers that were the chumps that kept it afloat while not ABA accredited.

 

[Wreckem]

It's true, you have to ask yourself if saving 10 grand now is worth the opportunities you will forfeit later.

Y'all have it backwards, Schools are numbers whores. Undergrad doesnt matter, grad/terminal degree school does.

Now obviously if your only schooling is undergrad yeah the better the school the more options. But high GPA + high GMAT/MCAT/LSAT can get you from 4th tier podunk undergrad to top schools. Undergrad reputation only helps if you boarderline getting in or not.

 

[TruePaige]

Y'all have it backwards, Schools are numbers whores. Undergrad doesnt matter, grad/terminal degree school does.

Now obviously if your only schooling is undergrad yeah the better the school the more options. But high GPA + high GMAT/MCAT/LSAT can get you from 4th tier podunk undergrad to top schools. Undergrad reputation only helps if you boarderline getting in or not.

People who went to a top undergrad school have a better chance of scoring high and transitioning though because they didn't underdo brain rot in their undergrad, I'd assume.

 

[halik]

Y'all have it backwards, Schools are numbers whores. Undergrad doesnt matter, grad/terminal degree school does.

Now obviously if your only schooling is undergrad yeah the better the school the more options. But high GPA + high GMAT/MCAT/LSAT can get you from 4th tier podunk undergrad to top schools. Undergrad reputation only helps if you boarderline getting in or not.

I would beg to differ. Top undergrad program will definitely give you more of an edge in getting into a good Grad program. If you have a 4.0 from MIT CS program, departments will literally blow you to get into their phd track.

 

[palehorse]

Tell that to the woman that owes more than $550,000 and will be paying till she is 70.

Just out of curiosity, who do you blame for that massive personal debt?

 

[jhu]

It's less than a minute and then it loops :-D

Yeah, didn't notice that until 3 minutes later...

 

[Blackjack200]

Just out of curiosity, who do you blame for that massive personal debt?

Well, it's a catch 22... once she got the education she became smart enough to realize that the cost was not worth it.

 

[palehorse]

Well, it's a catch 22... once she got the education she became smart enough to realize that the cost was not worth it.

does that realization somehow relieve her of the responsibility for paying off her debts?

 

[WhipperSnapper]

Perhaps we need to reconsider the wisdom of allowing naive kids who are younger than age 25 to sign their lives away to student loan debt. Also, to reduce moral hazard, perhaps we should make the universities partially liable for some of this debt in some sort of a way, giving them an incentive to engage in birth control to reduce oversupplies of graduates. The other problem is that lenders don't need to worry about these loans being paid back in any sort of a way because they cannot be discharged in bankruptcy.

 

[WhipperSnapper]

There arent a bunch of unaccredited law schools outside of CA. Yes SNESL got denied accredition by the ABA, it was recommeneded to but denied by the full ABA governing board, but it is accredited by the regional accrediting board, and approved by Mass to granted JDs, which is why Umass is gobbling up. Never go to a new 3rd/4th tier.

The ABA will pretty much accredit any law school that has a heartbeat. These types of law schools are referred to as TTT's, btw, Third Tier Toilets. BTW, for a good time, visit the JD Underground to see what angry unemployed and underemployed lawyers think about life.

http://www.jdunderground.com

 

[WhipperSnapper]

I want the 3 minutes of my life back

It wasn't a complete waste because now you know where El Fenix's and Halik's avatars came from.

 

[StageLeft]

In doing so, you may be depriving other Newfies of an education.
The government may have a limited pool and relies on honest Canadians (ex pats or not) to keep the pool liquid.

Newfoundland should be shut down anyway and just kept on a skeleton crew enough to pull the oil out of the ocean floor and that's it.

 

[Robor]

I want the 3 minutes of my life back

Damn, now it's stuck in my head. Still, it was better than Badger, badger, badger, badger...

 

[CPA]

I remember that. My wife has a few small Canadian student loans left and one of them in the last several months was given a lifetime 0% interest rate, backed by the newfoundland gov. I simply have no motivation at all to pay it off, so I'm just going to make minimum until I get tired of writing checks.

You mean backed up by the citizens of Newfoundland.

 

[halik]

Perhaps we need to reconsider the wisdom of allowing naive kids who are younger than age 25 to sign their lives away to student loan debt. Also, to reduce moral hazard, perhaps we should make the universities partially liable for some of this debt in some sort of a way, giving them an incentive to engage in birth control to reduce oversupplies of graduates. The other problem is that lenders don't need to worry about these loans being paid back in any sort of a way because they cannot be discharged in bankruptcy.

I would think that if judges were given mo leeway to discharge loans due to hardship, lenders would think twice about giving someone 250K to get a degree in mesopotamian studies with a minor in kinesiology at NYU.

 

[lothar]

I would think that if judges were given mo leeway to discharge loans due to hardship, lenders would think twice about giving someone 250K to get a degree in mesopotamian studies with a minor in kinesiology at NYU.

The problem is they're not allowed to do that by law.
Federal government regulation prohibits companies from discriminating based on major.

Why do you think the Federal Student Loan Consolidation market has collapsed the past 2 years with pretty much the government being one of the few(if not the only!) ones accepting federal loan consolidation?

Government isn't the solution, government is the problem.

 

[Zargon]

MIT Sloan is about 40k a year for graduate tuition. You'd be a fool not to go if you can get in the program. The doors a degree from MIT Sloan opens are worth every penny. Same goes for Darden, Darthmouth, Kellogg, and Wharton for starters.

um, if you really smart enough to be at MIT, they pay for your tuition.

Not that I am that smart, I will will have to pay for my masters(not from MIT either).

But yeah, my brother and his wife both got PhD's in ChemE from there, and they were given assistantships or whatever that covered their tuition plus some piddly amount for expenses

 

[alphatarget1]

Much like the housing market, the Federal government forces lenders to give loans to people who probably won't have a good job prospect to pay it off. Lenders should be able to discriminate against sh!tty majors at expensive schools (such as music) , forecast their job prospect with any particular field of study and adjust interest rates accordingly.

I would argue there is a huge surplus of psychology, sociology, (input liberal arts major here) in this country who are working only a little bit more than minimum wage, yet the Obama administration wants to subsidize failure of our higher education system.

 

[alphatarget1]

The problem is they're not allowed to do that by law.
Federal government regulation prohibits companies from discriminating based on major.

That's the liberal way. You end up with "educating" a bunch of loons like Moonbeam who aren't really contributing anything tangible to our society.

 

[halik]

Much like the housing market, the Federal government forces lenders to give loans to people who probably won't have a good job prospect to pay it off. Lenders should be able to discriminate against sh!tty majors at expensive schools (such as music) , forecast their job prospect with any particular field of study and adjust interest rates accordingly.

I would argue there is a huge surplus of psychology, sociology, (input liberal arts major here) in this country who are working only a little bit more than minimum wage, yet the Obama administration wants to subsidize failure of our higher education system.

Agreed. On one hand the fact the loans are non-dischargeable lowers the overall rates, but that at least some extent because people with employable majors are subsidizing kids with BAs in ancient greek mythology.

I'm sure the risk of default for my Master's in Finance loan is lower than what the 6% federal rate implies. I'm essentially paying 6% to make sure a person with BA in linguistics from NYU doesn't have to pay 15%

 

[ElFenix]

I'm sure the risk of default for my Master's in Finance loan is lower than what the 6% federal rate implies. I'm essentially paying 6% to make sure a person with BA in linguistics from NYU doesn't have to pay 15%

boy are you getting raped


<--- 2.5% and loving it



(a friend of mine remarked that the reforms are set up so that white upper middle class kids can stay in school forever)

 

[Acanthus]

What percent of that 60% are students in school are just out 6 months?

Plus with the economy the state its in the unemployed get a forbearance as well.

Not to mention if you transfer schools your loans are considered in forbearance until you graduate AND the 6 month grace expires.

Very sensationalist.

 

[Cattlegod]

um, if you really smart enough to be at MIT, they pay for your tuition.

Not that I am that smart, I will will have to pay for my masters(not from MIT either).

But yeah, my brother and his wife both got PhD's in ChemE from there, and they were given assistantships or whatever that covered their tuition plus some piddly amount for expenses

He is talking about the B school. Getting an MBA from a top 10 university will net you a 6 figure starting salary. Most people are able to pay it back in a year or two.

 

[Special K]

boy are you getting raped


<--- 2.5&#37; and loving it



(a friend of mine remarked that the reforms are set up so that white upper middle class kids can stay in school forever)

Unfortunately there's no way for new students to secure such low rates for student loans anymore. Under the old Stafford loan system (pre-July 2006), the interest rates were tied to the 91-day Tbill yield. When these yields were very low in 2004-2005 (or in 2008-2009, if you didn't happen to consolidate in 2004-2005), it was possible to consolidate Stafford loans at a rate of 2.8% or so. Factor in an automatic bank debit discount of 0.25% and a consecutive on time payment discount of 1%, and you are looking at a rate of 1.6XX% for the life of the loan. Unfortunately those deals aren't possible anymore.

 

[Special K]

He is talking about the B school. Getting an MBA from a top 10 university will net you a 6 figure starting salary. Most people are able to pay it back in a year or two.

Would it also be worth it after the opportunity cost? I have to imagine that most people who go to a top B-school were probably already making near $100k even before attending.

Also aren't the majority of jobs available to top B-school grads going to be in NYC? If you're coming from a low cost of living area, that $100k in NYC may not be nearly as much as you think it is.

These are serious questions for anyone who cares to reply. I'm actually interested in possibly going to B school myself someday, and these are questions I need to figure out first.