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Is the penny starting to drop on student loans?


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Interesting that this was forwarded to me on Whatsapp.Dare I ask whether this is the thin end of the wedge?

The poster doesn't realise that he's been charged RPI plus 3% for 13 years and that when it coems to getting a mortgage,it is included in the calcs.

He also hasn't twigged that if inflation moves up,then his repayments will be higher than £120k........

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Edited by sancho panza
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I posted on here before that my niece had an advisor come to her school and speak to her 6th form (London, posh) and say that most of them would never earn enough to worry about paying the loan back,

They should not be going to university if they don't need to, the whole 'education, education, education' scam was dreamt up by New Labour to fiddle the youth unemployment figures. 75% of the kid

From a legal perspective UK student loans aren’t debt because you can’t default on them. It’s a graduate tax with the optionality to pay it off. The interest rates are high so that they can fleec

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2 minutes ago, sancho panza said:

Interesting that this was forwarded to me on Whatsapp.Dare I ask whether this is the thin end of the wedge?

The poster doesn't realise that he's been charged RPI plus 3% for 13 years and that when it coems to getting a mortgage,it is included in the calcs.

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The interest rate on student loans is crazy. Over 6 percent off the top of my head.  

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Student loans aren't debt. They are QE. It's money the government is prepared to pay but doesn't care about and has no intention of recovering. Ffs he has to earn 56k before he even starts paying off the capital. He should forget about it and treat it as free money like everything else in our monopoly money economy. 

Edited by Green Devil
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13 minutes ago, Green Devil said:

Student loans aren't debt. They are QE. It's money the government is prepared to pay but doesn't care about and has no intention of recovering. Ffs he has to earn 56k before he even starts paying off the capital. He should forget about it and treat it as free money like everything else in our monopoly money economy. 

I pay back a student loan, and it doesn't feel like free money when you look at the deductions on your payslip.

Luckily I went to uni before this guy and now earn enough that I will have it cleared in a few years, but once you get to higher salaries the monthly payments get a bit eye watering, especially if you consider you could have invested that money in silver miners, or a riskier investment like a house. 

 

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Eye watering sums. Whether or not it is “traditional debt” or whatever doesn’t have much of a bearing on how demoralising that must be to see for these recent grads paying chunks out of their salary to watch their debt go up. Absolutely nothing they can do about it, no control over the matter. The options are either not to go to university and find an alternative route through life (the norm decades ago but more difficult now), just accept that your earnings are going to have a chunk taken out of them for the bulk of your working life, or sit and hope that there’ll be a debt jubilee.

I fortunately missed all this by a few years and consequently my loan will be fully repaid within two to three years and on the old Plan there is a cap which prevents the upcoming inflation from blowing the remaining sum into something much bigger. I struggle with holding debt (my childhood has made me very averse to it), so I know that all of this would probably have hit me badly.

For him not to know the debt he was taking on before he goes though...a government’s wet dream.

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I had a smaller student loan years ago, the consensus and advice definitely seemed to be that it wasn't like a normal loan and the interest would be negligible.  Someone pointed out in my first or second year to me that actually it wasn't quite so simple and wasn't really government handout but was going to be charging profitable rates.

Buyer beware and all that!  I shouldn't have gone at the time anyway for other reasons and ended up being a big waste - didn't really have business being there at least initially.  Ended up finding the easiest breeze through course once in but guess I ticked a box for family or whatever 🙁.

I actually thought student loans had been sold off so no longer on the governments tab?

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11 minutes ago, Dogtania said:

I had a smaller student loan years ago, the consensus and advice definitely seemed to be that it wasn't like a normal loan and the interest would be negligible.  Someone pointed out in my first or second year to me that actually it wasn't quite so simple and wasn't really government handout but was going to be charging profitable rates.

Buyer beware and all that!  I shouldn't have gone at the time anyway for other reasons and ended up being a big waste - didn't really have business being there at least initially.  Ended up finding the easiest breeze through course once in but guess I ticked a box for family or whatever 🙁.

I actually thought student loans had been sold off so no longer on the governments tab?

I know in the US the companies that owned the student debt lobbied very hard for student loans not to be includable in bankruptcy cases.  The ONLY debt that it is not applicable to.

funny that.

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6 minutes ago, wherebee said:

I know in the US the companies that owned the student debt lobbied very hard for student loans not to be includable in bankruptcy cases.  The ONLY debt that it is not applicable to.

funny that.

Woe, that's pretty interesting.  I guess they don't write off the loans either after a certain amount of years.

Either way they obviously saw the probable issues ahead.

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1 hour ago, Castlevania said:

From a legal perspective UK student loans aren’t debt because you can’t default on them.

It’s a graduate tax with the optionality to pay it off. The interest rates are high so that they can fleece the more productive (higher earners) to help fund those who will never even make any repayments.

It's the single biggest example I know of in recent years of a western government fucking over it's own young for shits, giggles, and power

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2 hours ago, Castlevania said:

From a legal perspective UK student loans aren’t debt because you can’t default on them.

It’s a graduate tax with the optionality to pay it off. The interest rates are high so that they can fleece the more productive (higher earners) to help fund those who will never even make any repayments.

In other words it is socialism, those paying student loans should be proud and grateful they have had the privilege to help those less fortunate than themselves to have the opportunity to go to university and study for a degree that is not necessarily economically productive.

Any student who protests about student loans is obviously a right wing extremist and a bad person.

Shut-up, pay-up, and help others who have less academic privilege.

Edited by Chewing Grass
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It's basically another tax added to the list of cripping costs that weren't there a generation ago that is levied to anyone stupid enough to try and become middle class.

The level of debt you'll leave with before you start work is equal to what some of your parents generation would have paid for the house they live in, even adjusted for inflation.

So let's say you come from a council estate and will inheret no money. You have two choices:

1. Go on the bennies like your parents. Work 16 hours a week from age 16, be a parent while you're still young and play the tax credit game.

2. Get into 50K of education debt, then try and establish a career, then as you approach 30 take on 30 years of crippling mortgage debt on top of the already 5 figure education debt you have. Oh and every penny over 50K you earn the government takes 40% of. Work 40 plus hours a week (emphasis on plus if you wanna earn the big money) until you die.

Edited by JoeDavola
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No surprise when they sold off the student loan book (undervalued IIRC) to private sector, who will be looking to make a decent profit on it, hence the way above base interest rates.

Also wouldn't be surprised if you follow the money and find those that pushed for the sell off are involved with the private companies either then or now as 'sleeping' directors or other 'useless twat handout' company positions with no real power in the company as way of thanks for the corruption.

Bottom line is this country is as corrupt at the top as any other and if you're either not rich enough or connected enough you'll be the mug paying for all the corrupt handouts and incompetence. A lesson it seems some need to go to university to find out.

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17 hours ago, Green Devil said:

Student loans aren't debt. They are QE. It's money the government is prepared to pay but doesn't care about and has no intention of recovering. Ffs he has to earn 56k before he even starts paying off the capital. He should forget about it and treat it as free money like everything else in our monopoly money economy. 

No, they are debt. And that's the issue.

If nothing changes over the 30 years then you are down for 10% of your earnings over 30 years.

The stupidest thing about the UK system, and theres lots of cretinous elements to it, is the system encourages the most useless n pointless HE degrees n students as theres little downside i,e you have to earn ~27k before the tax kicks in. 

So, Moonbeam can study Lesbian Art then go off n have turkey baster kids and live on UCs, earning fuckall.

And it discourages poorer people from studying a worthwhile I.e higher paying HE courses taking that risk.

I used to look at the US and see the debt they left with and think - Phew...

A US mate cleared his after almost 6 years, not trying particular hard. I went to the party. It was about $40k, about £30k back then. He was earning $60k at the time. Hed housesshared for 5 years, clearing about $7k a year, then got married.

I mention 'If nothing changes' as the system is not viable for much longer. 

The 'clever' idea of two brains Willetts, someone so out of touch stupid Im surprised hes not choked to death on porridge instantly backfired - expecting a range of tution prices from different Unis. Every single one charges 9k.

Then 'clever' Gidiot pretenting all the debt would be repaid so didnt have to be accounted for didnt last long. So student debt is also adding to national debt at a rapid rate.

TE has a briefing on HE. Connected to covid. But theres also a lot of people in the US n UK gov having very large doubts about mass HE, where the bulk of degrees are either non vocational or taught badly, adding nothing to yge country, just making jobs for useless academics.

https://www.economist.com/briefing/2020/08/08/covid-19-could-push-some-universities-over-the-brink

Put firefox into noscript n you can read it

 

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17 hours ago, wherebee said:

I posted on here before that my niece had an advisor come to her school and speak to her 6th form (London, posh) and say that most of them would never earn enough to worry about paying the loan back, so they should not worry about it.

That was an official, state organised speaker.  Lying to the children.

 

fucking disgraceful.

True but ...

You run up other debts beyond tution n mainenance loans. These will be even more expensive.

Theyll get stuck in a debt trap, avoiding earning more to avoid the debt limit. I've seen this a lot.

Then theres lost earning / opportunities from goung to Unis. Even in the best of situations, few women who have kids will ever earn enough to pay back the loans. Meaning theres a valid reason for keeping women away from HE.

My niece, after being at some made up HE course at the local tech (A levels, followed by foundation course, followed by 3 years at 'uni') is now, at the grand age of 25 doing a job she could have done at 16. An expensive, pointless, waste of time. If - a big if- she ever hits the lower limit in payback.

Even if 'they never pay back the loan...' theyve got 30 years paying an extra 10% tax.

If only they insisted on a level maths for HE entrance. Theyd be able to do compounding interest.

In it's current form the HE sector and student debt is an jbsandly bad deal for US n UK taxpayers. The only people who benefit are the ever increasing faculty.

 

 

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8 hours ago, DownwardSpiral said:

Eye watering sums. Whether or not it is “traditional debt” or whatever doesn’t have much of a bearing on how demoralising that must be to see for these recent grads paying chunks out of their salary to watch their debt go up. Absolutely nothing they can do about it, no control over the matter. The options are either not to go to university and find an alternative route through life (the norm decades ago but more difficult now), just accept that your earnings are going to have a chunk taken out of them for the bulk of your working life, or sit and hope that there’ll be a debt jubilee.

I fortunately missed all this by a few years and consequently my loan will be fully repaid within two to three years and on the old Plan there is a cap which prevents the upcoming inflation from blowing the remaining sum into something much bigger. I struggle with holding debt (my childhood has made me very averse to it), so I know that all of this would probably have hit me badly.

For him not to know the debt he was taking on before he goes though...a government’s wet dream.

No, its debt.

It exists, it's on ukgov books, it attracts interest.

The inky difference us you cannot default on it. Insane.

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8 hours ago, Dogtania said:

I had a smaller student loan years ago, the consensus and advice definitely seemed to be that it wasn't like a normal loan and the interest would be negligible.  Someone pointed out in my first or second year to me that actually it wasn't quite so simple and wasn't really government handout but was going to be charging profitable rates.

Buyer beware and all that!  I shouldn't have gone at the time anyway for other reasons and ended up being a big waste - didn't really have business being there at least initially.  Ended up finding the easiest breeze through course once in but guess I ticked a box for family or whatever 🙁.

I actually thought student loans had been sold off so no longer on the governments tab?

Profitable!!,!

UK borrows at 1% but compounds student debt at 5%

The batches of student loans have been  sold off, at large discounts.

If I had my way the discount would be took from the USS pension fund.

 

 

Edited by spygirl
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16 minutes ago, spygirl said:

A US mate cleared his after almost 6 years, not trying particular hard. I went to the party. It was about $40k, about £30k back then. He was earning $60k at the time. Hed housesshared for 5 years, clearing about $7k a year, then got married.

That's very low.

My lad's full fees are $47k per year for four years.

Of course there are bursaries available, but getting out at $10k per year is either a community college or very skilled.

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1 minute ago, spygirl said:

No, its debt.

It exists, it's on ukgov books, it attracts interest.

The inky difference us you cannot default on it. Insane.

1 minute ago, spygirl said:

No, its debt.

It exists, it's on ukgov books, it attracts interest.

The inky difference us you cannot default on it. Insane.

No, the government sold the book to a private company. So that their mates in the city can screw the young and ex PMs get a nice cushty job on leaving the house. 

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1 minute ago, Wight Flight said:

That's very low.

My lad's full fees are $47k per year for four years.

Of course there are bursaries available, but getting out at $10k per year is either a community college or very skilled.

He was instate, from 89 to 93ish at Stanford.

student-debt-1-share-1531247234740-super

About right.

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5 minutes ago, One percent said:

 

Too socialist worker.

The student debt book was sold off so

- One show that ukgov / HE sector was producing investable grad. The discount shows neither are. The discount is going get huge, so it eont be worth the cost n embarrasment trying to sell it.

- Get the debt of the books. 

 

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Just now, spygirl said:

Too socialist worker.

The student debt book was sold off so

- One show that ukgov / HE sector was producing investable grad. The discount shows neither are. The discount is going get huge, so it eont be worth the cost n embarrasment trying to sell it.

- Get the debt of the books. 

 

Eh?   o.O

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