tokenadult--AMEN
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For some applicants, and for ANY genuinely poor applicant, it's probably safer to gain admission to a college with a higher list price but phenomenal financial aid, and end up coming out of college with less debt.
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Less debt is better. Seems easy enough to understand. But, as you point out later, this may not be an option for students who did not do so well in HS.
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The push to make student loans available even to students who haven't achieved well in free K-12 schooling, and to make sure lots of lenders participate in that market, means that some loans that would never be made in the first place in a more balanced market will be made. Each borrower has to look at the situation realistically before signing the loan agreements, which always include a promise to repay the loan.
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Thats right. If the policy is to incourage high risk lending, it is the borrower who has to be realistic. And, all loans that are not repaid further increases the cost to the future high risk borrowers who need these loans and do repay them.
But all this does not seem to address what several posters seem to think is essential, "affordable" public college with aid/grants and no repayable loans. I simply do not think that spending the accumulated capital represented by endowments to pay ANY students to attend is prudent management and it puts the long term viability of these institutions at risk, which is terribly "policy."
That seems to leave taxes as the only other option. However, I agree with you, the public has provided enough in free K-12.
BTW--I looked at every college's statment sent to my S concerning the cost to my S to attend that school. EVERY ONE of these documents clearly listed scholarship as scholarships and loans as loans. No "deception" there. As you point out, when families don't take care in understanding what they are doing it is theor mistake. Unless you do away with loans, they are going to have to be listed some way.