<p>Please forgive me if this is a recycled topic.</p>
<p>It simply seems SL/parent plus loan interest rates are in the category of usury. I remember these rates were always the lowest, back in the day.
Now, compared to mortgage, auto, etc. they’re the highest!</p>
<p>Why? And why is this being allowed by the fed?</p>
<p>You have a unique definition of usury. The loans you reference above are all guaranteed by collateral. Student loans are not. </p>
<p>When credit card rates can be over 18% you can’t call student loan rates usury. 6.8% unsub Stafford and 7.9 Plus are reasonable. </p>
<p>The Fed does not set or have any control over these rates. </p>
<p>If you don’t like the rates you are free to find another source of funds at a lower rate. If you find someone lending money on an unsecured loan for less than 7.9% please let us know.</p>
<p>Point of fact, there are CC rates in the 8-10% bracket. When mortgage & auto loans were much higher, SL’s were always below their rate, so why should SL’s now be higher, especially given new rules such as not being included in a bankruptcy?</p>
<p>Usury seems appropriate</p>
<p>I don’t see anyone being forced to take out student loans.</p>
<p>ek4,</p>
<p>Well golly gee. Why didn’t I think of that? I’m sure colleges would be happy to close down since the level of debt from college loans is greater than that of CC debt.
The most conservative estimates show over 50% of students have some form of loan.</p>
<p>Point of fact - 8% to 10% is still higher than the Plus or unsub Stafford loans. And the sub Stafford is 3.4%. </p>
<p>Auto loans are being held artificially low due to being used as an incentive by auto makers. The banks then have to shave margins to compete. Thus low rates. Mortgages are 30 year loans for the most part and are backed by collateral. </p>
<p>Did you ever consider that perhaps student loans were historically kept low as a subsidy that is no longer available? The low student loan rates were the abnormal condition? Look up the prime rate for the last 20 years. Graph it against Stafford loan rates. That is data not opinion. </p>
<p>Again, show me an example of a non-secured personal loan you can get below 7.9%. You can’t. Please lookup the definition of usury.</p>
<p>All loans bearing interest are considered usury by sharia law. However, I know plenty of Muslim students who borrow student loans.</p>
<p>Point taken. :)</p>
<p>I’m talking the secular definition.</p>
<p>There are ways to reduce loan costs. Americorps gives a living stipend while participating and an educational voucher to be used for loans or tuition after completion of service.</p>
<p>A college education needs to be budgeted for just like having children, buying a house or a new car. Is that really such a news flash?</p>