Parents On The Hook For Student Loans
Parents drowning in college debt. Unable to pay back loans. They’re getting a tough lesson in college debt economics.
May 1st is the decision deadline for an awful lot high school seniors deciding with their families where to go to college. Deposit day. Show us the money day. And a day when it’s good to have thought about college costs. College students aren’t the only ones graduating with a lot of debt. Parents are taking out big loans too, to help pay for that education. And many are now in trouble. Stumbling under college debt for their kids as they head for retirement. Up next On Point: parents and college debt. — Tom Ashbrook
From Tom’s Reading List
Wall Street Journal: The U.S. Makes It Easy for Parents to Get College Loans—Repaying Them Is Another Story — “Student loans made through parents come from an Education Department program called Parent Plus, which has loans outstanding to more than three million Americans. The problem is the government asks almost nothing about its borrowers’ incomes, existing debts, savings, credit scores or ability to repay. Then it extends loans that are nearly impossible to extinguish in bankruptcy if borrowers fall on hard times.”
Washington Post: DeVos dials back consumer protections for student loan borrowers — “The Education Department is in the middle of issuing new contracts to student loan servicing companies that collect payments on behalf of the agency. These middlemen are responsible for placing borrowers in affordable repayment plans and keeping them from defaulting on their loans. But in the face of mounting consumer complaints over poor communication, mismanaged paperwork and delays in processing payments, the previous administration included contract requirements to shore up the quality of servicing. Companies complained that the demands would be expensive and unnecessarily time consuming.”
New York Times: They Thought They Qualified for Student Loan Forgiveness. Years Later, the Government Changes Its Mind. — “Hundreds of thousands of people with piles of federal student loan debt had not been too concerned because they were counting on a federal government program that would forgive those loans if they worked at least 10 years in a public service job. But what happens if the definition of “public service” seemed to change midway through that decade?”