<p>busdriver, at some schools that meet need, such as the example I gave from Brown, a family at that income level that you mention will get some scholarships and some loans.</p>
<p>In any case, of course middle income people do not have the luxury for paying out of pocket or current income! I surely don’t! But they could opt to pay something from current income, maybe a little was previously saved too, and then take out loans for ten years. It can be done. And those with low income are hurting just as much even if they pay less for college as it is all relative as the percentage of income they have to pay is just as difficult if not more.</p>
<p>Poetgirl–it’s also illegal to walk away from your house and your mortgage, when you can afford it but just don’t like the looks of the home valuation. ‘Strategic default’, my ***. I saw that piece on 60 Minutes & it really got my blood boiling.</p>
<p>And it’s entirely possible people will take a cue from these yahoos and decide down the line that the value of their kid’s college education isn’t worth much ('cause their son or daughter is unemployed and living at home) and default on that too!</p>
<p>Regarding student loans not being forgiven at death, I was always told that federal student loans are discharged at death, but unfortunately, private student loans are not. Anyone with any information to the contrary, please feel free to respond.</p>
<p>Yes, there are kids who are penalized. If the kid has parents who are considered able to pay and they won’t pay for whatever reason, that kid is not going to get financial aid from most colleges. Or if the parents simply refuse to fill out the forms. So,yes, kids are penalized for the parents they have, as they are rewarded.</p>
<p>It’s well and good to dangle names of colleges that are generous with aid, but when the acceptance rate is so low at those schools, there are not many kids who can benefit from those schools’ policies. I am not anywhere nearly as concerned about kids who are ivy calibre whose parent’s can’t or won’t pay. It’s the kid who is in that gray area that can benefit the most. The top kids are highly likely to make it wherever they go to school and have many options. It 's the mid range kid with the mid range income that is the largest group that can benefit from options that are unaffordable to them.</p>
<p>“Do people think that those making $60,000/year can “stomach” paying $15,000/year, plus loans, toward college any better?”</p>
<p>But at the top schools, would they even pay that, and have to take loans? Take a situation where 2 kids are in a top computer science program. Both have no assistance from their families. Kid A gets 200K in loans for the exact same education as Kid B, who gets 60K in loans. They graduate, work for the same company. Kid A takes 10 years to pay off his loans at 20K/year (reasonable, in a high income profession). Kid B takes 3.</p>
<p>I don’t know that there is any “fair” way to do it. It is tough to be in anyone elses shoes. But it is interesting that this is one of the only services people get the exact same product, but at completely different prices. It doesn’t affect me, because I assume we’ll never get a discount (but pray for merit aid), but I can surely see why people would be frustrated.</p>
<p>If you die with no assets or insufficient assets to pay your debts, then that is the end of it. If you have enough money left that it is worth while for creditors to go after your “estate” , they will unless the loans specifically say they are forgiven at death. Usually even if there is not such indication, creditors are not going to go through the expense and trouble to go after the money.</p>
<p>My FIL died with debts up the whazoo. There were a few years of threatening letters but no one got a dime. The family liquidated what assets there were and made off with them and that was it. And yes, there were unpaid school loans in that lot.</p>
<p>JNM- The 'thing" is that the these “loans” are garuanteed by the government. You really “can’t” walk away any more than you can “walk away” from paying back taxes. It’s entirely different. They WILL simply take money from your paycheck. Seriously, it’s a racket. </p>
<p>I would even say that it would make sense to make stafford’s undischargable. I’m not a huge fan of kids leaving school with 20,000 in debt, but okay. We’ll say it’s doable, and we’ll say fine. Right now, though, banks can lend a kid 150,000 to get a college degree. It’s ludicrous.</p>
<p>busdriver, re: 325…
I wasn’t just talking about top schools in my question. People are complaining that lower income students receive more aid than those who make over $100,000 receive. But the hit on their parents’ pocketbook hurts as much as the hit that the upper middle class family will have…it is a significant chunk of their incomes relatively speaking. For example, if you have to use 20% of your income toward college, it hurts no matter how much you are earning (and likely even more for a lower income person because at a certain point of income, your major expenses are covered and for a lower income person, they can barely cover basic expenses alone). </p>
<p>Now, you are mentioning a STUDENT taking out $200,000 in loans. First, I don’t know a student alive who has taken that amount out in his own name for loans. That implies not only that the family put NOTHING toward college (yet makes over $100,000/year) or that the parents took none of the loans and are making the student pay for the entirety of the loans/expenses for college. I don’t even know if a student could secure that amount in loans under their own name. There tends to be a limit to the amount a student can borrow. I think your example is not reality. The kid in your example with $200,000 in loans is not penalized because he is middle income but is penalized because his parents refuse to spend a dime toward college or toward college loans.</p>
<p>But, suzie, go over to the financial aid board, and you will find stories of people who owe that much. Also, you have to keep in mind that even if the parent’s co-sign, the loans are still the kids’ responsibility.</p>
<p>Mostly, though, if you are trying to convince me that student loan practices in the US are ethical or responsible, it won’t work. We have already seen just how “ethical” bank loans can be, honestly, responsible enough to bring down the economy. </p>
<p>Why have college costs NOT responsded to market pressures? Because the colleges really don’t care where the money is coming from as long as the bills are being paid. The amount of debt we are allowing this generation to take on to get a college education is criminal. This is my considered opinion, and it is going to have long term economic consequences, as well. </p>
<p>My family is completely full pay and I know we are fortunate. We have been able to live our lives essentially debt free. Do a work up on the interest payments some time and you will see the true “cost” of these borrowed educations are masive. This is not student “aid,” anymore than a car loan is “driver’s aid,” or a morgage is “home buyer’s aid.” It just isn’t. These loans aren’t even “low-interest.”</p>
<p>Sorry, I didn’t know that about student loans. My son’s girlfriend has a large student loan debt already and she is just a sophomore. She is at an expensive LAC where she was accepted ED and then her parents lost their jobs. College savings were diverted to pay living expenses. She loves her school and apparently doesn’t want to transfer to an affordable instate option. These loans will only increase, I don’t judge this situation, or I try not to but it will be a heavy burden when she graduates.</p>
<p>I agree there is a large range in what is considered middle class and a large range in upper middle class to high income. Someone who has a family income of $500,000+ is having a different financial discussion regarding college then someone making $150,000+, yet they are both considered rich. Well, rich according to statistics. Please no one get mad at me. I consider the $500,000 income “rich”.</p>
<p>Poetgrls response #330 was more eloquent and accurate than I could come up with. As usual.</p>
<p>The amount of debt is criminal. Personally, if my family was relatively low income and struggling to come up with the required funds, I would either take an inexpensive option, or not ask them to pay off the student loan debts after I graduated. I would not ask my parents to do anything that would be a hardship for them.</p>
<p>Please understand that I am more than FULLY aware of the true cost of college loans. I have a LOT of them to repay for two kids’ UG and one kid’s grad school. Our kids are not paying any loans. I am paying Parent Loans, Stafford Loans and Perkins Loans and will be for many years.</p>
<p>“Please understand that I am more than FULLY aware of the true cost of college loans. I have a LOT of them to repay for two kids’ UG and one kid’s grad school. Our kids are not paying any loans. I am paying Parent Loans, Stafford Loans and Perkins Loans and will be for many years.”</p>
<p>You are a kind and generous mother. I don’t know if I would have done that for my kids. I wouldn’t have wanted them to take out large loans, but they wouldn’t have the option to go to expensive schools. I hope your children are very grateful.</p>
<p>busdriver, yes, my kids are grateful. But having our kids pay anything toward college is not something we ever considered. My parents paid for me to go to college and grad school and I now pay it forward. I highly value education and feel as parents, that it is our responsibility to give our kids this opportunity. We just find a way to make it work for them to go to the colleges of their choice. Yes, they were expensive colleges but by the same token, we did not pay the sticker price as they received both need and merit based scholarships, though we would have sent them regardless. Also, it is my greatest pleasure to pay for their education and my kids, in my mind, deserved it, as they worked very very hard to get to where they are and made the very most of their college years. Maybe I’d feel differently if my kids were lazy or goofed off in college or some such. They are highly motivated types and achievers and we feel they did their part and we have done ours. I am happy to do so and never considered anything less. Our kids are appreciative. We do not support our kids once out of school, unlike some parents. We paid for them to be educated and all related expenses for that and after that, they are responsible to support themselves and they do. I realize not everyone has the same values and I respect that.</p>
<p>D1 is in 1st year med school and like most of her classmates does not have a pot to **** in. By the time she enters residency in 2014 and practice 3-5 years after that, she will have incurred an incredible (at least to my way of thinking) amount of debt. Maybe that’s a LITTLE bit better than if she had a ton of UG loans, but other than her Staffords (about $20K) we are taking care of the rest, with PLUS loans. Hopefully by the time she graduates, there hasn’t been a complete collapse of MD/DO salaries, she’ll have some earning power & has a shot at paying it back. Worrisome all the same.</p>
<p>I think there will always be plenty of families who are willing & able to be “full pay.” </p>
<p>So, maybe it is possible that some schools will not have an “economically diverse” student body, i.e. very wealthy students or very poor students, but the middle class has been squeezed out. That is very sad, when you think about it!</p>