<p>This is very interesting… I heard a speaker who is was an intern at SoFi – this is a model where alumni loan out $'s to students from their school… and is a peer to peer lending model…</p>
<p>I didn’t realize that student debt totals more than $1 trillion, and larger that the credit cdard debit which is $800 million… What a crisis… there has to be a better solution… </p>
<p>SoFi, is a start up established last year… </p>
<p>I don’t understand how this is a solution to the student loan crisis. As far as I can see, the only thing that changes is who’s raking in the interest.</p>
<p>The rates are lower at 6% versus 6.5% to 7.9% for federal, because they are less of a default risk. Federal loan rates are normalized to accommodate default risks of all institutions. Also alumni is directly interfacing with the students who are borrowing, and get a 5% return… Its just an alternative, but to me is similar to the micro loan concept… Very interesting to me…</p>
<p>True, it may be a slightly more attractive option. The rates are marginally lower and they say the students may have networking opportunities with the wealthy alumni. Still, the loans have to be repaid just like any other loan. A solution would involve lowering the cost of college, not making it easier to borrow. This isn’t a fix, just a small tweak.</p>
<p>Seems to me that the real beneficiaries here are the alumni lenders. A 5% return these days is pretty doggone good.</p>