The Truth About Student Loan Debt

This is the time of year when hundreds of thousands of eager young Americans are looking forward to their first year in college.  The last thing most of them are usually thinking about is how they are going to pay off all of the student loans that they are signing up for.  But they should think about it.  After all, do you buy a house or a car without first considering how you are going to pay for it?

But somehow it has become “politically incorrect” to suggest to college students that they should consider how in the world they plan to pay for the education they are about to receive.

Most young college students assume that they will just run out and get a great job once they graduate and that paying off these loans will be no problem.

But for millions of young Americans, that has turned out to be a very faulty assumption.  In fact, in the current economy millions of recent college graduates are unemployed and “good” jobs are few and very far in between.

And it gets really hard to pay off tens of thousands in student loan debt without a good job.

The New York Times recently profiled Cortney Munna – a recent college graduate who has not been able to get that “good job” and who now finds herself in student loan hell.  She told the New York Times that she would gladly give back her education to get out of all this debt….

“I don’t want to spend the rest of my life slaving away to pay for an education I got for four years and would happily give back.”

The truth is that is exactly where hundreds of thousands of young Americans find themselves.

So if you are getting ready to take out huge student loans, you might want to think twice before signing the dotted line.

So just how bad is it out there?

Well, with tuition at some universities now running more than $30,000 a year (before you even add fees and expenses), students are racking up debt at an alarming rate.

The Project on Student Debt estimates that 206,000 students graduated from college with more than $40,000 in student loan debt during 2008.  Using 2008 dollars, that represents a ninefold increase over the number of students graduating with that amount of debt in 1996.

So the truth is that we have a real student loan debt crisis on our hands.

Young people are getting into massive amounts of debt and they are not getting good jobs that allow them to be able to service all of this debt.

And bankruptcy is not an option for these young people either.

In fact, federal bankruptcy law makes it nearly impossible to discharge student loan debts.

So once you are in student loan hell you are basically stuck there for the rest of your life.

So, young person, think really, really hard before you sign that dotted line.

Because once you take that student loan, it is going to follow you for the rest of your life.

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Comments

  • http://roxieSh82.bravejournal.com Ellis Nebel

    I have learned some important things as a result of your post. I would also like to express that there can be situation where you will apply for a loan and dont need a cosigner such as a Government Student Support Loan. But if you are getting a loan through a conventional financial institution then you need to be prepared to have a cosigner ready to assist you to. The lenders are going to base any decision on a few issues but the greatest will be your credit rating. There are some loan providers that will furthermore look at your job history and determine based on that but in many instances it will hinge on your scores.

  • Jenine

    Student loan hell is right. My mom went to college for ten years because she took some time off in between to take care of my sister and me. After she graduated from Morgan Univ. (which is supposed to be one of the most superior black colleges in the US), the loan company she borrowed from (Sallie Mae) harassed her like crazy. She had jobs in her field here and there from late 2004 to mid summer 2006, but after that she couldnt get another job in her field. As a result, her credit became messed up because of these school loans and she had to work minimal wage jobs like cashier and so forth. There was no way she could pay back those huge loan bills!

  • Bryant Isbell

    I totally agree. Which is why Ive decided not to go back. Of course Ive already got 10k to pay back but hey it could be more.