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Why I Defaulted on My Student Loans

Discussion in 'Sports and News' started by YankeeFan, Jun 9, 2015.

Page 18 of 26
  1. The Big Ragu

    The Big Ragu Moderator Staff Member

    1) I never accused him of committing a criminal act. You keep telling me I said things I have never said. ... and then trying to get me to respond to these things YOU are saying.

    2) If you consider taking out a loan and purposefully not repaying it a "business decision," agree to disagree. At best I'd call it an unscrupulous business decision.
     
    The Big Ragu, Jun 10, 2015
    #205
  2. Ace

    Ace Well-Known Member

    Bottom line here is banks throw money at students with little or no credit history and expect to get stiffed.

    If you owe $40,000 and never finish college, that's gonna be a tough nut to pay.

    You're a bank throwing $100,000 at some guy getting his English degree, that joke is on you.
     
    Ace, Jun 10, 2015
    #206
  3. cranberry

    cranberry Well-Known Member

    It's a failure of government that the guy had big loan obligations after financing an undergraduate and two advanced degrees?

    Or are you saying the government doesn't keep up with the increasing costs of education with Pell grants? Or that states aren't putting sufficient money into their public system schools? Or that government isn't doing enough to keep college affordable across the board?

    Those are the government failures I see.
     
    cranberry, Jun 10, 2015
    #207
  4. JimmyHoward33

    JimmyHoward33 Well-Known Member

    Problem as I see it is the value of education is intrinsic. Default on a car or house, you lose your car or house. Default on college loans, after graduating, and what can you lose?

    They loan companies should go after this guy and if the penalties are so lax that it starts a mass default then the regulations and penalties need to change. My fear would be hurting people who do want to pay in good faith but cannot. I suspect the consequences are more serious than this author implies and that his situation does not translate to most paying back student loans.
     
    JimmyHoward33, Jun 10, 2015
    #208
  5. KJIM

    KJIM Well-Known Member

    THAT'S the bottom line here?
     
    KJIM, Jun 10, 2015
    #209
  6. The Big Ragu

    The Big Ragu Moderator Staff Member

    No, the joke isn't on the bank that made the loan.

    Student loans made by private commercial lenders (not the direct loan programs, such as FDLP, which are just as horrendous but don't involve private, commercial lenders), have been Federally guaranteed since the 1960s, under a variety of programs, most notably FFEL.

    Private commercial lenders are happy to take on the risk you find ridiculous for someone to have taken (and I agree with you!). ... because they don't pay the price if there is a default. In fact, the ONLY reason everyone can get a loan at a government-mandated, non-market, low rate of interest is that the government guarantees those loans--skewing the equation they would make for who and who isn't a credit risk if THEY bore the risk.

    That is moral hazard in a nutshell (not the misuse of the term several times by someone else earlier on the thread). People who don't have to bear the burden of a risk -- because of misguided policy like that -- will take on a ton of risk. When things go badly, someone else (you, me and everyone else) bear the costs.
     
    The Big Ragu, Jun 10, 2015
    #210
  7. WriteThinking

    WriteThinking Well-Known Member

    Cranberry nailed the real issue in this whole thread and the actual problem with the whole issue being discussed -- no matter where you fall and no matter how you define fraud -- way back in the fourth post.

    It's the same lament often expressed by my mom about marriage/divorce, too. Promises mean nothing, commitments don't matter, obligations don't matter, and getting out of them is just too easy and convenient. Whether that indicates change is needed or not, it is the crux of the matter.
     
    WriteThinking, Jun 10, 2015
    #211
    dprince57 likes this.
  8. bigpern23

    bigpern23 Well-Known Member

    When you repeatedly accused him of theft and fraud - both criminal acts - I guess you were not accusing him of criminal acts. My mistake.

     
    bigpern23, Jun 10, 2015
    #212
    LongTimeListener likes this.
  9. The Big Ragu

    The Big Ragu Moderator Staff Member

    Look at the last thing you quoted.

    LTL asked me why he wasn't being prosecuted for fraud. I was responding to him.

    Fraud can be a civil wrong. If I sue you for defrauding me, for example, my accusation is not a criminal complaint. It is a tort. Do you understand the difference?
     
    The Big Ragu, Jun 10, 2015
    #213
  10. LongTimeListener

    LongTimeListener Well-Known Member

    So why hasn't anyone sued this guy? It sounds like an open-and-shut case.
     
    LongTimeListener, Jun 10, 2015
    #214
  11. BTExpress

    BTExpress Well-Known Member

    Ya know, doing the right thing isn't always the best business decision
    Heck, it's probably almost never the best business decision.

    But if I find $10,000 on the street, I will face zero consequences if I pocket the bundle and make zero effort to return it to its owner. It's obviously the best business decision I can make.

    But it"s the wrong thing to do. It really is that simple. You either care about doing the right thing. Or you don't.
     
    BTExpress, Jun 10, 2015
    #215
    HC likes this.
  12. bigpern23

    bigpern23 Well-Known Member

    Is theft a civil wrong or is it a criminal act?
     
    bigpern23, Jun 10, 2015
    #216
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