As graduation time approaches (or, er, is already here), articles about student loans are popping up all over. Aside from the usual advice-laden paragraphs advising college grads to consolidate now so they can lock in interest rates before July 1, and advising high school grads to be careful about borrowing for college, there are a couple of more interesting things out there to read:
-This article in the Northeast Mississippi Daily Journal, in addition to advising college-bound folks to avoid borrowing, also shines a little light on the for-profit monster that is Sallie Mae ("now a private corporation whose profits put Exxon to shame"): "The loans have been helpful to millions. They've also become a nightmare to tens of thousands. ... It's not unheard of for a student who has borrowed $25,000 to be facing double that much in arrearages - even after making sporadic payments for four or five years."
-The Christian Science Monitor reports on the "albatross" of student loans: "With hefty repayments in their future, however, many students...are walking away from low-paying government, nonprofit, and teaching jobs. ... Accumulating loan debt even pushes back many of life's milestones, according to a survey that Baum conducted in 2002 for Nellie Mae, a major student lender, which is now a subsidiary of Sallie Mae. The report found that 38 percent of graduates held off buying their first house because of student loans, 14 percent put off marriage, and 21 percent delayed having children.
'We are the first society in history to take our brightest and start them out in debt,' says Allan Carlson, president of the socially conservative Howard Center in Rockford, Ill. 'That's just stupid public policy. We should encourage them to grow, not hold them back.'"
-The Mercury News reports on a recent survey which shows that "[a]lmost seven out of ten respondents are paying off student loans or have spouses who are, and the average outstanding balance is greater than $29,000. Almost 40 percent of graduates with college debt expect to take more than 10 years to pay off their loans."
-Maybe some folks in Washington are paying attention, though, as is evidenced by this Letter to students from Senator Edward M. Kennedy: "Current law, for example, does not allow borrowers to "reconsolidate" - i.e., refinance - a consolidated student loan, but it should. Borrowers who consolidated their loans at higher interest rates in the past deserve to be able to refinance their loans again when interest rates go down, just as homeowners take advantage of lower rates by refinancing their mortgages. I'm also working to reduce interest rates for all student loan borrowers. Lenders are making record profits under the government's college loan program, and restricting student loan benefits is an unfair way to reduce the federal budget deficit."
*National Student Loan Debt Clock is at almost $420 billion and counting...
