US Dep of Ed ad money spent to suck ME (a foreigner) into student debt bubble

[swissaustrian]

Apparently google thinks that I`m a US student who is eligible for student loans.
(note: I`m already a phd and a Swiss citizen)

I just got this ad on a Swiss news website.



The ad links here:
http://studentaid.ed.gov/

That`s your taxdollars at work

[torchbearer]

indentured servitude in disguise.
this previous statement is not hyperbolic.

[swissaustrian]

It`s certainly about dependency, but it`s also about inflating prices for education:


The student debt bubble is popping as we speak:


This is a trillion dollar problem, ie approximately the size of subprime in 2006/07.
However, the US gov is basicly the sole creditor. The banking system should not be affected.

[torchbearer]

maybe you aren't familiar with the terms of the loan-
bankruptcy does not touch student loans.
you sign for student loan- you are debt slave.

[swissaustrian]

Right I forgot that.

what are they (Dep of Ed) going to do if delinquency rates continue to skyrocket?

My guess is that eventually political pressures will be so immense that there will be some kind of debt jubilee for student loans.

I also heard that government employees get their loans written off after 10 years of "service"?
A brief search resulted in this: http://studentaid.ed.gov/repay-loans...public-service

I haven`t read the whole page...

[malkusm]

My guess is that eventually political pressures will be so immense that there will be some kind of debt jubilee for student loans.

Better not be. I worked through my undergrad and grad educations and took loans for the rest, and have been paying them back for several years now. Any debt forgiveness program is fraught with perverse incentives for the younger generation, teaching them that irresponsibility will be rewarded as long as everyone else is doing it, too.

[torchbearer]

Right I forgot that.

what are they (Dep of Ed) going to do if delinquency rates continue to skyrocket?

My guess is that eventually political pressures will be so immense that there will be some kind of debt jubilee for student loans.

I also heard that government employees get their loans written off after 10 years of "service"?
A brief search resulted in this: http://studentaid.ed.gov/repay-loans...public-service

I haven`t read the whole page...

they will confiscate any pay you get-
they will even confiscate social security to repay student loan.

[frodus24]

If you default on student loans...meaning no payment for 270 + days, then your tax refund is kept and you can have your wages and social security garnished.

[seraphson]

maybe you aren't familiar with the terms of the loan-
bankruptcy does not touch student loans.
you sign for student loan- you are debt slave.

I'm actually quite curious. What exactly happens after you file bankruptcy and all your crap is liquidated and you still didn't have enough capital to cover your losses? (Let's assume a business or divorce) Where does all that un-payed credit go? Some magical abyss to be absorbed by taxpayers?

[Seraphim]

The creditor takes a haircut on the value of the bonds.

I'm actually quite curious. What exactly happens after you file bankruptcy and all your crap is liquidated and you still didn't have enough capital to cover your losses? (Let's assume a business or divorce) Where does all that un-payed credit go? Some magical abyss to be absorbed by taxpayers?

[torchbearer]

I'm actually quite curious. What exactly happens after you file bankruptcy and all your crap is liquidated and you still didn't have enough capital to cover your losses? (Let's assume a business or divorce) Where does all that un-payed credit go? Some magical abyss to be absorbed by taxpayers?

there are two sides to every transaction.
when a loan is defaulted on- the loaner loses(bond holders/savers). there are prescribed ways for those lenders to get some of their money back by taking possession of the debtors property(with some limits).

when you invest money in a company through a stock, you are in essence, loaning that money to them(but in a different mechanism)
you are not guaranteed a return on that stock, and neither are you guaranteed a profit from the money you loan.
That risk of losing is what is suppose to keep banks prudent.
But with student loans, they can't lose- they then lend and lend and lend(without the hazard of default)- a student going for an art degree at community college will rack up $70,000 in student loan debt before anyone even starts to say anything.

[enjerth]

to help fuel our debt-based economy.