Debt Loans – PSP Book http://pspbook.com/ Sat, 19 Nov 2022 17:30:15 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://pspbook.com/wp-content/uploads/2021/05/default1-150x150.png Debt Loans – PSP Book http://pspbook.com/ 32 32 Blocking relief is an “unhealthy game” https://pspbook.com/blocking-relief-is-an-unhealthy-game/ Sat, 19 Nov 2022 17:30:15 +0000 https://pspbook.com/blocking-relief-is-an-unhealthy-game/ Guilherme Lopes, 31, is a first-generation college student with $146,000 in student debt. He said recent court rulings blocking debt relief “look like a really sick game”. The uncertainty of succession prevents him from planning financially for the future. Loading Something is loading. Thank you for your registration! Access your favorite topics in a personalized […]]]>
  • Guilherme Lopes, 31, is a first-generation college student with $146,000 in student debt.
  • He said recent court rulings blocking debt relief “look like a really sick game”.
  • The uncertainty of succession prevents him from planning financially for the future.

Guilherme Lopes was the first in his family to attend college in America.

After immigrating to the United States from Brazil when he was 5, Lopes, now 31, says he lacked the knowledge to navigate the financial aid system. When guidance counselors at his high school advised him to take out student loans to fund his education, that’s exactly what he did.

Lopes took out direct federal loans under her own name, and her mother took out Parent PLUS loans to help cover additional costs. His balance is nearly $146,000, about $46,000 more than his balance at graduation in 2013 due to interest. Like many in his position, he was thrilled when President Joe Biden said on the campaign trail that he would approve $10,000 in debt relief.

“A big part of my policy views was how we were going to approach student loans, if we could get some relief or if we could make the system a little bit easier for people,” Lopes told Insider. “So when Biden was running, it was really attractive at first when he said he would forgive $10,000.”

However, shortly after Biden announcement its one-time student loan forgiveness plan, a number of conservative lawsuits have arisen to block debt relief. Some of the lawsuits have been dismissed by the district courts – the Supreme Court itself diverted of them. But last week, two federal courts blocked the implementation of debt relief, leaving millions of borrowers in limbo as they wait to find out when, or if, they will see a reduction of up to $20,000 on their loan balances. loans.

As a nonprofit worker who currently earns a five-figure salary, Lopes is also enrolled in the Civil Service Loan Forgiveness Program, which promises to forgive student debt for government and nonprofit workers. lucrative after ten years of qualifying payments. But he still has a ways to go with that repayment plan, and he was hoping that $10,000 in relief would help him progress faster. He also hoped it would help his mother and brother, who were also in debt.

“That’s really rude, because my mother is an immigrant who crossed the border and found citizenship here and went through the struggle, finally found the courage to take online classes and got her master’s degree online, and she also owes money at the age of 65,” Lopes said. “It’s just terribly wicked. It’s not the American Dream we were promised would come.”

“It looks like a really sick game”

Last week, a Texas federal judge ruled that Biden’s debt relief is illegal in response to a lawsuit brought by two student loan borrowers who did not qualify for the full amount of loan forgiveness. On Monday, the Eighth Circuit Court of Appeals ruled that the temporary suspension it imposed on the aid will remain in effect until the court rules definitively on its legality.

The Ministry of Education appealed the decisions. While the Biden administration has confidence expressed that will prevail in court, Lopes said he was upset that these lawsuits even happened in the first place.

“I really think it affects mental health,” Lopes said. “It’s more of the unknown, the uncertainty, it just feels like a really sick game. Are we going to take a break? Are our payouts coming back? It’s just annoying.”

With court rulings blocking relief indefinitely, the department is no longer accept new applicationsand he indicated in a recent court filing that it is “examining” another one extension of the student loan payment break.

The financial uncertainty these lawsuits have created, as well as a possible extension of the payment break, have prevented Lopes from planning her wedding or buying “anything of significant value.” He stressed that he was not asking for handouts, but he feels that many Americans have a sense of “right, I went through it, so you have to go through it.”

“It seems a little weird to me,” Lopes said. “It raises a lot of anxiety.”

“I have faith because the alternative is anxiety”

Lopes said he was lucky his employer paid for his graduate degree, but during that time he deferred repayment of his undergraduate loans and accrued interest, which drove up his balance. . He said he wished the terms of student debt had been made clear to him from the start, especially since interest kept many other borrowers likewise make a dent in the original balance they borrowed.

With the lack of clarity surrounding student loan forgiveness, Lopes said he had “no choice” but to remain hopeful the Biden administration will follow suit, adding, “I have confidence because the alternative is anxiety”.

During this time, many defenders and Democratic lawmakers have ideas for what Biden should do to ease the stress millions of borrowers are feeling right now. Several advocacy groups have called for an extension of the student loan repayment pause, with Wisdom Cole, director of youth and college for the NAACP, saying in a statement Wednesday that the organization “fully supports the extension of the repayment until borrowers get the relief they deserve”. and have been promised.”

“It’s infuriating that the very people who benefited from hundreds of thousands, if not millions of dollars in bailouts are now attacking Aid for Americans with Pell Grants, 51% of which goes to students whose families earn less than $20,000. per year,” he said. . “It’s hypocritical, sickening and says a lot about the kinds of politicians who need to be overthrown. But they won’t win this fight.”

]]>
The Union Offers Additional Student Loan Debt Webinars https://pspbook.com/the-union-offers-additional-student-loan-debt-webinars/ Thu, 17 Nov 2022 21:22:55 +0000 https://pspbook.com/the-union-offers-additional-student-loan-debt-webinars/ If you’re confused about student loan forgiveness programs — or panicked by the start of federal student loan repayments in January — you’re not alone. Recent court rulings could jeopardize the Biden administration’s efforts to expand student debt relief. Until resolved, these legal challenges leave millions of borrowers in financial limbo. To complicate matters further, […]]]>

If you’re confused about student loan forgiveness programs — or panicked by the start of federal student loan repayments in January — you’re not alone.

Recent court rulings could jeopardize the Biden administration’s efforts to expand student debt relief. Until resolved, these legal challenges leave millions of borrowers in financial limbo. To complicate matters further, the Civil Service Loan Forgiveness Scheme, which some thought was only available until October 31, is in fact still available, albeit in a more limited way now that the waiver has expired.

All of these developments have left many educators scratching their heads and checking their bank balances. To learn more about student debt relief, register for one of NYSUT’s free online student loan webinars offered to members in partnership with Cambridge Credit Counseling. With a live presentation and Q&A session, a Certified Cambridge Student Loans Advisor will guide you through the latest updates and help get you on the right track. Participants will also receive free access to the Cambridge Student Loan Portal, as well as the ability to schedule individual counseling sessions.

The next online webinars will take place on Wednesday, November 30 at 6 p.m.; Tuesday, December 13 at 4:30 p.m. and January 10 at 6 p.m. Thousands of NYSUT members have already taken advantage of this free union benefit. Through this program, counselors will help you better understand the various student loan repayment options, as well as the latest twists in public student load forgiveness programs.

Student debt relief has always been a complex — and controversial — topic, with many saying its complexity ends up exploiting borrowers. Unions have advocated tirelessly for the simplification, reform and expansion of loan forgiveness programs. Union leaders are committed to keeping members informed.

Here are some highlights of recent developments.

PSLF is always available to educators and other public servants. This is the case even if you missed the October 31 deadline to apply for the Limited Civil Service Loan Forgiveness Waiver. Significant ongoing improvements have been made to the program, so that more educators can benefit from the debt forgiveness they were promised. Incidentally, so far more than 236,000 educators and public service workers have received $14 billion in student loan forgiveness under the union-backed PSLF waiver.

Federal student loan payments are expected to resume and interest will begin to run again on January 1. Student loan payments have been suspended since March 2020, when the CARES Act was approved due to the pandemic. Union leaders are urging (LINK) the administration to extend the payment freeze to help borrowers who are still struggling with crippling debt.

A new federal loan forgiveness program, which was announced by President Biden last fall, has been halted by a number of ongoing legal challenges. As of last week, the US Department of Education stopped accepting applications for the new program, which would provide up to $20,000 in federal student debt relief to people earning less than $125,000. So far, more than 26 million student borrowers have already applied for the new debt relief, with around 16 million applications already approved. Biden officials said. While legal challenges could ultimately end up in the U.S. Supreme Court, the U.S. Department of Education said it will retain borrowers’ information so it can quickly process the remedy “once we win in court.” the tribunal”.

As the legal appeal process progresses, we will post updates on any new developments, including the resumption of the program.

]]>
How to choose the best debt consolidation lender? https://pspbook.com/how-to-choose-the-best-debt-consolidation-lender/ Tue, 15 Nov 2022 06:30:53 +0000 https://pspbook.com/how-to-choose-the-best-debt-consolidation-lender/ The Good Brigade/Getty Images Debt consolidation is combining multiple debts into one loan to reduce the number of bills you pay each month. Ideally, when consolidating debt, you also reduce the interest rate you pay and you can ultimately pay off the debt faster. If you are considering debt consolidationYou should start by deciding which […]]]>

The Good Brigade/Getty Images

Debt consolidation is combining multiple debts into one loan to reduce the number of bills you pay each month. Ideally, when consolidating debt, you also reduce the interest rate you pay and you can ultimately pay off the debt faster.

If you are considering debt consolidationYou should start by deciding which method is best and evaluating your financial and credit health to determine if you are a good candidate for debt consolidation. Once you’ve taken these steps, you can move on to researching and evaluating lenders to find the best solution to help you pay off those crippling debt balances sooner.

Identify the type of debt consolidation that suits you best

The first step is to evaluate debt consolidation options and select the method that is best for you. Common methods include:

  • Personal loan: Many lenders offer debt consolidation loans or personal loans designed to help you pay off your debts faster and save a lot of interest. Debt consolidation loans usually come with a fixed interest rate and a loan term of 1 to 10 years. You are free to use the funds as you see fit, but the idea is to pay off your debt balance with the loan proceeds.
  • Zero APR credit card: Also known as balance transfer credit cards, these debt products can help you save a significant amount in interest and eliminate high-interest debt balances faster. They are generally reserved for consumers with a good or excellent credit rating. You should only consider this option if you can repay the balances you transfer to the card during the introductory period. Otherwise, you could end up paying a fortune in interest.
  • Home Equity Loan: You can convert up to 85% of your home equity into cash and use it to consolidate your debt with a home equity loan. It acts like a second mortgage and comes with a repayment period of between five and 30 years. The interest rate is also fixed and lower than most credit cards, but the main drawback is that your home guarantees these loan products. Therefore, you could lose your property to foreclosure if you fall behind on loan repayments.
  • Home Equity Line of Credit (HELOC): A HELOC is a home equity loan, but you will not receive the loan proceeds in a lump sum. Instead, you’ll have access to a pool of money that you can draw on as needed during the 10-year draw period. Interest-only payments are also required during the drawdown period on most HELOCs. Once completed, you will repay in monthly installments over a term of up to 20 years. The amount of the monthly payment can fluctuate since the interest rate on HELOCs is generally variable.

It’s important to select the best option for your needs, as this will help determine the type of lender you choose. Not all lenders offer the same borrowing options. Once you’ve decided on a consolidation option, you can analyze each lender’s interest rates, loan terms, and fees to determine which offers make the most financial sense for your goals.

Determine your qualifications

Lenders want to know that you are creditworthy and have the means to make timely payments on the loan or credit card you are using to consolidate your debt. This means you can expect the lender to assess your credit score and credit history to determine if you have a history of responsible bill paying.

Lenders will also look at your debt-to-equity ratio to determine if you can afford monthly repayments and if you’re not taking on more than you can handle. Lenders also want to see verifiable proof of income and will be looking for long-term financial stability.

Also, be aware that the most competitive interest rates are generally reserved for borrowers with a good or excellent credit rating. A lower credit score doesn’t always mean you’ll automatically be denied a loan or credit card. Still, you will usually get a high interest rate if approved to offset the risk of default posed to the lender or creditor.

Ultimately, you may find that it doesn’t make sense to consolidate your debt if you have bad credit if you only qualify for a higher rate than you’re currently paying.

Shop around for lenders

Look for lenders that offer the type of debt consolidation you are looking for. Most offer online prequalification with a flexible credit application. If you’re considering a debt consolidation loan, you’ll also get an overview of potential loan costs to compare your options with.

In addition to checking online lenders when shopping, it may be a good idea to check the options available from banks or credit unions. You may qualify for more favorable loan terms if you have a pre-existing relationship with a bank or lender.

Regardless of the type of lenders you include on your shortlist, prequalification takes the guesswork out of finding lenders willing to work with you. Plus, you’ll avoid going to lenders who might deny you a loan or credit card and get an unnecessary credit check.

Assess the lender

Once you have a shortlist of at least three lenders, it is a good idea to compare them side by side and compare the factors below, which will impact the overall cost of your loan, your ability manage it and the customer service you receive:

  • Annual Percentage Rates (APR): This figure represents the actual annual cost of borrowing. It includes interest and fees determined by your credit score and debt-to-equity ratio. Knowing this information for each loan option can help you assess which one will cost the least.
  • Lender fees: Some lenders charge origination fees ranging from 1-10% of the loan amount. Even if the APR is on the lower end, high origination fees might make a different loan product the more practical choice. Similar to APR rates, knowing each lender’s fees can help you determine which loan is more expensive or best suited for you.
  • Characteristics of the lender: Top lenders also have an online dashboard where you can monitor your account, schedule payments, and chat with customer service representatives. It’s also great if free educational resources can help you manage your credit and overall financial health more effectively. Understanding the features and customer service offerings of each lender gives you a better idea of ​​which loan will be easier to manage.
  • Customer reviews: You want to select a reputable lender with a proven track record of providing quality service. Checking online reviews from past clients can be a good way to gain peace of mind before signing on the dotted line with a lender. Seeking accreditation from the Better Business Bureau (BBB) ​​may also be a good idea.

At the end of the line

Before applying for a loan or credit card to consolidate your debt, weigh your options to decide which type of debt consolidation makes the most sense. Plus, get prequalified with at least three lenders to see potential loan quotes and compare your options. This will allow you to make an informed decision, reach your debt repayment goals faster, and save money.

]]>
Potential buyers offer lower prices for Musk’s Twitter debt https://pspbook.com/potential-buyers-offer-lower-prices-for-musks-twitter-debt/ Fri, 11 Nov 2022 22:07:56 +0000 https://pspbook.com/potential-buyers-offer-lower-prices-for-musks-twitter-debt/ Today we wrap up week 2 of the world’s richest man doing what he does on Twitter. And while you might already be aware of all this rollercoaster ride of mass layoffs, $8-a-month checkmarks and all that, there’s a whole other part of the story that doesn’t appeal as much. Warning. Musk paid $44 billion […]]]>

Today we wrap up week 2 of the world’s richest man doing what he does on Twitter. And while you might already be aware of all this rollercoaster ride of mass layoffs, $8-a-month checkmarks and all that, there’s a whole other part of the story that doesn’t appeal as much. Warning.

Musk paid $44 billion to buy Twitter. But it wasn’t all his money. He borrowed $13 billion to pay the bill, and Bloomberg News reports that the banks that lent him that money are now trying to offload those loans. They reportedly received offers for as little as 60 cents on the dollar.

It is quite common for a bank to sell loans it has made to help buy a business. In fact, that’s often the point, said Drew Pascarella, associate professor of finance at Cornell University.

“Banks usually make loans thinking they’ll end up selling at least some of those loans to other investors,” he said.

Pascarella said that at this point the banks have already collected their fees. And they don’t want to keep too much of their money tied to one company.

In addition, many other investors may be interested in taking out these loans.

“Hedge funds and private investors who seek to generate a return for their investors or for themselves through the return on these loans,” Pascarella said, for example.

But what is unusual about this deal are the significantly lower prices offered by potential buyers.

Sixty cents on the dollar? That’s not the norm, said Matteo Arena, a finance professor at Marquette University.

“Usually you see discounts, you know, 90 cents on the dollar, maybe 85 cents on the dollar,” he said.

Arena said those potential buyers — hedge funds and private investors — were worried. What if Twitter’s ad revenue runs out? What if Twitter goes bankrupt?

“If the company goes bankrupt, how much money we lend will we be able to recover in court? Arena said.

These kinds of questions are on the table because of what happened on Twitter recently.

“You don’t typically have a company that lays off half its employees in a week,” said Afra Afsharipour, a law professor at the University of California, Davis.

She said most people who borrow to buy businesses typically take some time after an acquisition to work with their lenders and figure out how they want to restructure the business “in the hope that they turn the business around and ‘they sell it to someone else, or they make it public,’ Afsharipour explained.

Either way, she said there are likely plenty of investors out there who would be willing to buy those loans — if they believe in the future of Twitter or if that debt is super cheap.

Clarification (November 11, 2022): This story has been updated to clarify that some banks have received offers of 60 cents on the dollar from investors for some Twitter debt, according to Bloomberg.

There’s a lot going on in the world. Through it all, Marketplace is there for you.

You rely on Marketplace to break down world events and tell you how it affects you in a factual and accessible way. We count on your financial support to continue to make this possible.

Your donation today fuels the independent journalism you rely on. For just $5/month, you can help maintain Marketplace so we can keep reporting on the things that matter to you.

]]>
4 tips to pay off your personal loans sooner https://pspbook.com/4-tips-to-pay-off-your-personal-loans-sooner/ Wed, 09 Nov 2022 11:32:41 +0000 https://pspbook.com/4-tips-to-pay-off-your-personal-loans-sooner/ Image source: Getty Images This simple trick can save you thousands of dollars on a loan. Key points Simply switching from paying your loans once a month to once every two weeks results in an additional payment for your loan each year. Other tricks like rounding up your payments and refinancing your loan can help […]]]>

Image source: Getty Images

This simple trick can save you thousands of dollars on a loan.


Key points

  • Simply switching from paying your loans once a month to once every two weeks results in an additional payment for your loan each year.
  • Other tricks like rounding up your payments and refinancing your loan can help you pay off your loan faster.

Personal loans can be a lifesaver when you need money fast, but they can also be a burden if you’re struggling with high interest rates. If you are having trouble repaying your personal loans or if you feel overwhelmed and stressed by the amount of your debts, you are not alone. Millions of Americans are struggling with high levels of debt, but there are things you can do to get back on track. Following these four simple tips can help you pay off your personal loans sooner.

1. Make bi-weekly payments instead of monthly payments

By making payments every two weeks, you’ll make an extra payment each year, which can help you pay off your loan faster. How does this work? If you repay your loan once a month, you will make 12 payments (12 months) in one year. By switching to repaying your loan every two weeks, you will make 26 equal payments, since there are 52 weeks in a year (52/2 = 26).

Even though each payment is half the monthly amount, you end up paying an extra month per year with this method, which translates to faster debt repayment. This trick also works for mortgages. For a typical mortgage, that may be the equivalent of paying off your mortgage eight years early!

2. Round up your payments

Instead of paying the minimum monthly amount, round up to pay a little more. For example, if your monthly payment is $456, round up to $500. It may not seem like much, but it can add up over time and help you pay off your loan faster.

3. Refinance your loan at a lower interest rate

Interest rates have risen significantly this year as the Federal Reserve raised rates to fight inflation. Once the Fed hits its 2% inflation target, we can expect the Fed to start cutting interest rates. If the interest rates are lower than the loan you have, refinancing with a low interest loan could help you save money on interest and pay off your loan faster. Be sure to consider the fees you must pay when refinancing your loan. Your credit score will make a big difference when you refinance. Seek to improve your score to help you get the best rates.

Apply any extra money you have, whether it’s a work bonus or a tax refund, to your personal loan to help you pay it off faster. Resist the temptation to spend it and use it for your loan instead. Look for some side shoves or overtime to increase your income. Use this money for your loans. Your future self will thank you!

Following these tips can help you save money and pay off your personal loan sooner. You can also combine these tricks to help you pay off your loans even faster.

The Ascent’s Best Personal Loans for 2022

Our team of independent experts have pored over the fine print to find the select personal loans that offer competitive rates and low fees. Start by reviewing The Ascent’s best personal loans for 2022.

]]>
Moving Forward: Student Debt Relief https://pspbook.com/moving-forward-student-debt-relief/ Sat, 05 Nov 2022 21:08:00 +0000 https://pspbook.com/moving-forward-student-debt-relief/ The United States Department of Education currently offers federal student debt relief. The program offers eligible borrowers full or partial loan release of up to $20,000 for Federal Pell Grant recipients and up to $10,000 for non-Pell Grant recipients. Pell grants are available to low-income students based on their FAFSA. Applications can be completed at […]]]>

The United States Department of Education currently offers federal student debt relief. The program offers eligible borrowers full or partial loan release of up to $20,000 for Federal Pell Grant recipients and up to $10,000 for non-Pell Grant recipients. Pell grants are available to low-income students based on their FAFSA.

Applications can be completed at studentaid.gov/debt-relief. The application takes about five minutes to complete. This is one-time debt relief. Applications opened earlier in October and will close on December 31, 2023. You do not need to provide any documents when applying, but the Department of Education may contact you for more information.

Not everyone is eligible for student loan forgiveness. First, there is an income limit. A person must have earned less than $125,000 in 2021 or 2022, from your IRS Form 1040. For families, the maximum income limit is $250,000 in 2021 or 2020.

People also read…

Private loans (from financial institutions, not the federal government) are not eligible for debt relief.

Debt relief only applies to loan balances you had before June 30, 2022. This includes Direct Loans (William D. Ford), FFEL Loans (Federal Family Education Loans), Perkins Loans, and Parent or Graduate PLUS Loans. Loans may or may not be subsidized by the government.

Any new loans disbursed (when loan funds have been received) on or after July 1, 2022 are not eligible for debt relief.

Federal loans in default (overdue) are also eligible.

Consolidation loans are a bit more complicated. This means that several loans have been combined so that a person only has to make one monthly payment. Federal student loan consolidation combines multiple federal loans into one federal loan through the Department of Education. These loans are eligible for the debt relief program.

Private lenders offer private student loan consolidation, also known as student loan refinancing. It’s a good idea to bundle private loans into one of these programs to lower interest rates and move to one monthly payment. These loans are NOT eligible for the debt relief program.

Private loans cannot be transferred to the federal government, but federal and private loans can be consolidated with a private lender. If you did this, you lost the opportunity to get debt relief on the federal loan. The Department of Education is still negotiating with private lenders to see if this can be changed, so people who have this type of consolidated loan should be careful that this is resolved.

Another complication is that there was a pause in payments during the COVID pandemic. From March 13, 2020 to December 31, 2022, borrowers did not have to make student loan repayments. If you made payments on your federal student loans during this time, the government will refund what you paid and forgive your loan up to the maximum amount of debt relief.

StudentAid.gov can provide assistance in completing the online form or answering questions related to a borrower’s specific situation. Contact the agency at 1-833-932-3439.

The Department of Education has issued several warnings about scams from companies offering to help you manage your loans or application for a fee. You NEVER have to pay for aid with your federal student aid. As with all scams, you would be asked for personal information and passwords. DON’T! If the government tries to contact a borrower, it will send an email from noreply@studentaid.gov, noreply@debtrelief.studentaid.govWhere ed.gov@public.govdelivery.com.

]]>
Confused about student loan forgiveness and checks? 4 things to know https://pspbook.com/confused-about-student-loan-forgiveness-and-checks-4-things-to-know/ Thu, 03 Nov 2022 11:48:48 +0000 https://pspbook.com/confused-about-student-loan-forgiveness-and-checks-4-things-to-know/ In defense of his debt relief package, President Biden said last week that his administration would push back against the states’ legal challenge and that the scheduled cancellation would begin soon. “We are going to win this case”, Biden told NewsNation when asked about the case. “I think in the next two weeks you’re going […]]]>

In defense of his debt relief package, President Biden said last week that his administration would push back against the states’ legal challenge and that the scheduled cancellation would begin soon.

“We are going to win this case”, Biden told NewsNation when asked about the case. “I think in the next two weeks you’re going to see those checks coming out.”

That last bit left some people confused. Borrowers eligible for the rebate will not receive a check through Biden’s program but will have their balances reduced by up to $20,000.

The debt relief plan aims to cancel up to $10,000 in federal student debt for people earning less than $125,000 a year, or less than $250,000 for married couples. Those who received Pell Grantsfederal aid for low-income students, could see up to $20,000 forfeited.

Now there is a separate initiative that could offer refunds to some borrowers. The Ministry of Education offered to return the money to people who continued to pay on their debt since the beginning of a payment in the era of the pandemic moratorium in March 2020. The policy went largely unnoticed until the Biden administration took notice when the president unveiled the debt relief plan.

Most of the nearly 42 million people covered by the pause have not made payments since its inception, but the Department for Education said around 9 million borrowers in good standing continued to send money. silver. This population of borrowers is entitled to repayments, which must be requested through loan servicers.

]]>
Decline in university enrollment; Student loan relief may not offer enough https://pspbook.com/decline-in-university-enrollment-student-loan-relief-may-not-offer-enough/ Sat, 29 Oct 2022 12:20:46 +0000 https://pspbook.com/decline-in-university-enrollment-student-loan-relief-may-not-offer-enough/ College enrollment has fallen in recent years, part of a larger trend over the past decade. High tuition fees and the wide availability of jobs that don’t require degrees keep students out. President Joe Biden’s student debt reforms could make college more attractive to some, but not all. Loading Something is loading. Thank you for […]]]>
  • College enrollment has fallen in recent years, part of a larger trend over the past decade.
  • High tuition fees and the wide availability of jobs that don’t require degrees keep students out.
  • President Joe Biden’s student debt reforms could make college more attractive to some, but not all.

While millions of graduates are to feel better about their decision to go to college after President Joe Biden’s announcement student debt reforms, many young Americans decide that the experience is not for them. And Biden’s plans might not be enough to change their minds.

College enrollment has fallen more than 1% since last fall, according to a recent report of the National Student Clearinghouse. Since the start of the pandemic, registrations have decreased by 6.5%. It’s approximately 1.5 million fewer students pursuing studies.

“After two consecutive years of historically significant losses, it is particularly troubling that the numbers continue to decline, particularly among freshmen,” said Doug Shapiro, executive director of the organization, said in the report. “While the decline has slowed and there are some bright spots, a return to pre-pandemic enrollment levels is becoming increasingly out of reach.”

Falling enrollment isn’t a new trend either – or a leads only by the pandemic. About 3 million fewer Americans are enrolled in college than a decade ago for reasons such as changes in age demographicsthe job availability that do not require degrees, and further examination to find out if the high cost worth it.

This decline could very well continue. In an ECMC group investigation more than 1,000 students conducted earlier this year, only 51% of Gen Z teens said they were considering a four-year degree. This marked a decline of 20 percentage points since May 2020.

While Biden’s August headline announcement may have been up to $20,000 in student loan forgiveness for millions of borrowers, it also laid the groundwork to make student loans less burdensome for students. But that might not be enough to offset the factors pushing students away from college campuses.

Even with student debt relief, concerns over education affordability loom

Along with Biden’s announcement of broad debt relief, he released details of a new income-focused repayment plan, which aims to provide borrowers with affordable monthly payments based on their income, with the promise of a discount after at least 20 years. The plan would allow some borrowers to have their payments limited to 5% their monthly income, which would be significantly lower than what borrowers currently pay under income-tested schemes.

Additionally, students can enroll in the Public Service Loan Forgiveness Program after graduation, which forgives their student debt if they work in the public or nonprofit sector and make 10 years of payments. eligible. The Department of Education recently announced permanent enhancements to the program to make it easier to join by relaxing eligibility requirements and allowing one-time account adjustments to correct past payment errors.

But unless declining enrollment starts translating into a substantial drop in tuition, the cost of a college education may prove too big a barrier for prospective students.

Adjusted for inflation in 2020 dollars, the annual price to attend a four-year college was around $10,000 in 1980. In 2020, it was nearly $30,000 in that year’s dollars.

While Democratic lawmakers pushed back on the idea that Biden’s student debt relief would lead to higher tuition fees, GOP lawmakers clung to that criticism. Senator Tom Cotton of Arkansas said in August that debt forgiveness “was just going to encourage college administrators to raise tuition and spend more money on wasteful jobs like schools with 160 different diversity coordinators.”

Although there are few signs of a significant tuition cut on the horizon, Mark Perry of the American Enterprise Institute already said Insider, there had been a glimmer of relief.

Tuition and university fees increase only 0.9% last year, the smallest increase since at least 1978 and well below the average 7% increase of the past 42 years, according to Perry’s analysis of Bureau of Labor Statistics data.

It remains uncertain if “the higher education bubble is finally starting to show signs of deflating”, Perry said in a blog post. Until that happens, young Americans are likely to remain wary of the cost.

High-paying jobs that don’t require a degree are increasingly common

During the last years, almost record job offers due to labor shortage product wage gains for many workers without degrees. It also led some employers to facilitate their requirements, with a greater variety of careers available to those without a university degree. Others explored alternative forms education such as trade schools, certifications and apprenticeships.

Jasey Tragesser, 27, has already told Insider she dropped out of college in 2014. Today, she earns $135,000 a year as a marketing manager for a software-as-a-service company. In her dozens of interviews over the past few years, she said her lack of a degree “never really came up.”

After leaving a job as a medical receptionist last year, Chyan Smith, 29, became a freelance locksmith despite her lack of experience in the field. already said Initiated. She said someone could “definitely” earn a minimum of $35,000 to $50,000 a year as a freelance locksmith.

As job vacancies fell by over 1 million in August, according to a Bureau of Labor Statistics survey, they remain high, suggesting that there are still plenty of opportunities for those without a degree.

The impending recession could change that, however, especially as the Federal Reserve aims to weaken labor market as part of its efforts to curb inflation. And since low-wage workers are often disproportionately affected when a recession hits, it could be those without a degree – who earn less on average – who pay the price.

]]>
Government should stop supporting for-profit companies (opinion) https://pspbook.com/government-should-stop-supporting-for-profit-companies-opinion/ Wed, 26 Oct 2022 07:01:47 +0000 https://pspbook.com/government-should-stop-supporting-for-profit-companies-opinion/ The federal government should at least do no harm when it comes to helping students earn a college degree. Instead, through student loans, our tax dollars are used to support institutions that are more predatory than for-profit educational institutions. These institutions charge their mostly low-income students so much that the involvement of the federal government […]]]>

The federal government should at least do no harm when it comes to helping students earn a college degree. Instead, through student loans, our tax dollars are used to support institutions that are more predatory than for-profit educational institutions.

These institutions charge their mostly low-income students so much that the involvement of the federal government amounts to exploitation. Too often, these institutions aim to make money before their duty to educate students. Their aggressive sales tactics convince vulnerable people to go into debt for a degree that is less usable — and more expensive — than an equivalent degree from a community college or four-year institution.

That is, if students graduate. The fact is, most don’t.

Only 30.7 percent students entering four-year for-profit institutions graduate in six years. Their education is often a broken promise. In contrast, 48.7% of students in public four-year institutions and 58.5% of students in private non-profit four-year institutions graduate in six years. The numbers are even worse for Pell Grant recipients entering four-year for-profit institutions, with 27.9% graduating within six years.

These dismal results are more troubling because many of these students are low-income or first-generation, often from families with little or no college experience.

For-profit colleges disproportionately enroll recipients of federal grants, including Pell Grants. Of all students attending four-year for-profit institutions in 2019-20, 69.2% were federal grant recipients. That’s about 20 percentage points higher than the proportion of students receiving federal scholarships at four-year public institutions.

Marketing ploys convince students with fewer resources or little family support to attend for-profit institutions. They see the promised education as the key to entering the middle class. Yet too often all these students get from this experience is mind-boggling debt that makes them financially worse, not better.

Students at for-profit four-year institutions borrow significantly more than those at non-profit four-year institutions. About 87% of students who earned a bachelor’s degree in 2015-2016 at for-profit colleges took out student loans, compared to 66% at public institutions; among borrowers from for-profit institutions, the borrowed medium for bachelor’s degree graduates was $44,610, compared to $34,430 in private nonprofits and $29,070 in public nonprofits.

The cost is breathtaking. Too many of these students go into huge debt for a substandard education.

Yet our government continues to allow 704 for-profit institutions in our country to administer student loans to 787 811 students who attend.

Our tax money should not be used in this way. The federal government should stop providing student loans to attend for-profit colleges. These institutions do not provide a public service, and their results and degree data have proven that the government should not support expensive speculative higher education institutions when student lives are at stake. At a minimum, the government should develop stricter laws and regulations based on the success of the few successful for-profit institutions.

For-profit organizations will oppose the end of student loans for their institutions. They will say they are market-driven, more flexible than traditional colleges, and provide students with hands-on classroom learning to enable them to work in the real world. They can even say that their market-based approach will inspire creativity, efficiency and effectiveness to satisfy shareholders and consumers.

But if they’re so market-driven and proud of their role in our capitalist system, they shouldn’t need the federal government to continue supporting them with student loans. They should not rely on making money by trapping students in debt. They should be completely market driven and make money from the strength of their product, like every other company in America. As we all know, if your product fails, your business will shut down. Let these for-profit colleges stand or fail on their own merits, without help from the federal government.

The federal government has taken steps to forgive student loan debt for students who attended former for-profit institutions. However, maintaining grants to allow other for-profit institutions to continue to drop off students is an insult to taxpayers. It is also a disservice to students who only want to improve through education.

It is time for the government to stand with the students, not those who exploit them.

]]>
US offers $1.3 billion in debt relief to struggling farmers and ranchers https://pspbook.com/us-offers-1-3-billion-in-debt-relief-to-struggling-farmers-and-ranchers/ Sun, 23 Oct 2022 08:30:13 +0000 https://pspbook.com/us-offers-1-3-billion-in-debt-relief-to-struggling-farmers-and-ranchers/ DES MOINES, Iowa – The federal government last week announced a program that will provide $1.3 billion in debt relief to approximately 36,000 farmers who have fallen behind on loan repayments or are facing a seizure. The U.S. Department of Agriculture announced the Agricultural Loan Relief Program funded from $3.1 billion set aside in the […]]]>

DES MOINES, Iowa – The federal government last week announced a program that will provide $1.3 billion in debt relief to approximately 36,000 farmers who have fallen behind on loan repayments or are facing a seizure.

The U.S. Department of Agriculture announced the Agricultural Loan Relief Program funded from $3.1 billion set aside in the Inflation Reduction Act allocated to help distressed direct loan borrowers or guarantees administered by the USDA. The law was passed by Congress and signed by President Joe Biden in August.

The USDA provides loans to approximately 115,000 farmers and ranchers who cannot obtain commercial credit. Those who have missed payments, are in foreclosure, or are heading into default will receive help from the USDA. Farmers’ financial difficulties can be caused by a variety of problems, including drought and transportation bottlenecks.

“Throughout their fault, our country’s farmers and ranchers have faced incredibly difficult circumstances over the past few years,” Agriculture Secretary Tom Vilsack said. “The funding included in today’s announcement keeps our farmers working and provides a fresh start for producers in difficult positions.

About 11,000 agricultural borrowers in arrears on direct or guaranteed loans for 60 days or more are receiving automatic electronic payments to be current on their loans. Each farmer with a direct loan received about $52,000 and those with guaranteed loans received about $172,000. The total cost for this group is nearly $600 million. Farmers who have received this assistance will receive a letter notifying them that their payments have been made and they will remain up to date until their next annual payment is due in 2023, Vilsack said.

An additional $200 million was used to immediately help 2,100 agricultural borrowers after their loans were foreclosed, but who still owed money and whose refunds of taxes and other resources were collected by the US Treasury. The money will be used to pay the money these farmers owe to give them a fresh start, Vilsack said. The USDA said farmers in this category received an average of $101,000.

An additional $571 million will be used to help several additional groups, including:

• 7,000 farmers who during the COVID pandemic delayed loan repayments until their loans ended. It will cost $66 million.

• 1,600 farmers facing bankruptcy or foreclosure will be assisted on a case-by-case basis with one-on-one meetings to assess their problem and find solutions at a cost of $330 million.

• 14,000 agricultural borrowers in financial difficulty and facing cash flow problems who request assistance to avoid missing a loan repayment will receive additional assistance. Vilsack said those issues could be caused by drought or low levels on the Mississippi River that slow down barge traffic, causing grain transportation issues. Up to $175 million will be available for this program.

The recently announced money is the first round of payments to ensure farmers stay in business or return to farming.

The rest of the $3.1 billion will be used to help ease unnecessary lending restrictions and provide additional aid to be announced later, the USDA said.

The USDA found that farmers assisted by the program were distressed borrowers hard hit by pandemic-induced market disruptions, exacerbated by more frequent and intense climate-driven natural disasters, the USDA said.

President Joe Biden and his administration continue to face criticism for enacting a program to cancel certain college loans, but some of the Republican politicians who have criticized the program did not respond to questions about whether they support the agricultural loan assistance.

The USDA also provided $31 billion to help nearly a million farmers offset declining sales, prices and other losses due to the coronavirus pandemic in 2021 and 2022, the US Government said. Accountability Office.

]]>