Most of the time I rant on this blog about
student loan servicers, or lenders, including
So today, let’s look at student loan borrowers.
America’s college grads have earned an “F” in understanding their student loans.
What Do Student Loan Borrowers Think?
Paul Bedard of the Washington Examiner reports the findings of a poll of current student loan borrowers:
- 27.50% of respondents incorrectly believed the Department of Education would forgive all, or part of, their student loan balance.
- 53% believe there is a fee to consolidate federal student loans. It is a free service, but many borrowers get scammed this way.
- 54.75% regret taking out the amount of student debt that they did.
- 20.25% believe there are no negative consequences for the cosigner if they make a late payment on a private student loan.
- 22.75% of respondents did not know their current student debt balance within $500.
- 36% of 2017 graduates did not know their monthly student loan payment after graduation within $20.
24.25% of borrowers plan on having their parents help them repay their student loan debt after graduation.
So, let me provide some cover for some of these student loan borrower answers. If you are eligible for the Public Service Loan Forgiveness Program (PSLF), you can have some student loans forgiven.
- And, if you qualify for one of the income based repayment programs, you can have some student loan debt forgiven. Although, the forgiven amount is taxable income, unlike the PSLF program.
- As to the fee to consolidate student loans, looks like the scam servicers have won this war, deceiving their customers into thinking they have to pay to get that done. Which is only one of the many tudent loan servicer mis-representations out there.
- Maybe the parents are going to help, so not sure why that last item made the list.
- As to co-signers, most people misunderstand that one, That debt is on the co-signer’s credit report from day one. And she or he is liable from day one for the whole amount. It does not shift to the co-signer at some later date. So, if you are late, that debt is late, and that goes on BOTH your credit report and that of your co-signer.
- Student loan borrowers do not know the balance of their loans, and do not know the monthly payment. And, in my experience, they do not know which are government, and which are private.
- This is part of the whole scam by the colleges and lenders, don’t worry about it, get that degree, then you make more money, blah, blah, blah.
- If the colleges told the truth, there would be fewer loans, and they would take in less money.