Parent Plus Loan information and experiences

twoinanddone
Sat, 22 Jul 2023 19:53:25 +0000

Spring4:

This lackadaisical approach to regulating this industry is, imo, why we have a student loan crisis,

I don’t know why you think student loans aren’t regulated. Direct loans to students and PPL are highly regulated. Ask @kelsmom how many binders of regulations she had to deal with from the Dept of Educ. They are also regulated by the CFPB, the loan servicers have a regulatory agency (state and fed) too.

If by ‘paying into this system’ you mean paying taxes, then yes you do have to pay for student loans, the army, credits on electric cars, roads, elementary schools, public radio, air traffic controllers… I don’t think student loans, or particularly Parent plus loans, is a money maker for the government but it does hope to break even. As far as I know, there there are only two ways out of parent plus loans. The first is bankruptcy, but it is very hard to get the loans waved in bankruptcy and only a few have been able to do it. The second is death, and that’s harsh too.

What do you want the government to do? They could get rid of all loan programs and then people would need to go to private lenders like Sallie Mae and Discover (which are also regulated just like all consumer lenders) or just not go to college. I don’t think that would change anything for those not taking PPL loans but students not getting Direct Loans would keep a lot of kids out of college. If students had to meet lending criteria for Direct loans, very few would as few have income that exceed their living expenses. If parents had to qualify for PPL, again few would meet the requirement and those could get private loans, so why bother with the PPL program at all? IMO, there should be limits on the PPL, just like there are limits on the Direct loan.

We all looked for ways for our kids to go to college. I set the budget for my kids and then tried to find ways for them to go to college on that budget. First we picked affordable colleges. I told my kids no PPLs for me and really preferred they not take the Direct loans. After the first year, they did need the Direct loans but they understood the terms and only took what they needed.

Two families that took PPLs were Mike Pense when he was governor of Indiana and Martin O’Malley when he was governor of Maryland. May have been the right choices for their families but not for mine. I don’t think either family was ignorant of what they were signing when they took the loans.