meirl

  1. When you take out a long term loan, the total interest for the duration of the loan is calculated and added to the total. During your first several years, most (nearly all, in some cases) of your payments will go toward paying the interest, with only a small amount going toward paying down the principal.

  2. Nope, you’re right. What he says implies his interest rate was about 9.5%, which is wrong. In 2017 student loan interest rates were 4.45%, so he would have paid off about $35k of the principal. I don’t disagree that a problem exists, but this post is bullshit.

  3. Nah he’s lying. That math doesn’t even make sense. I’ve had a mortgage for 3 years and if I take the first months payment ever, which has the least amount of principle paid and multiply it by 36, it’s still more than 2k.

  4. “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”

  5. Step 1: pay elementary school admins like $100 to tell kids born in after the 80s that college is the only option for you and you have to go to college to get a good job

  6. Federal loans? Yup. The feds are the ones that created this problem. And people want them to be more involved in this scam.

  7. It's because university is subsidised by government loans. It guarantees money to the university, so they can keep increasing the prices and students just keep taking loans out.

  8. NOBODY needs to take $120K in loans to get a college degree in the U.S. This is a choice. In most places community college is a low cost (or free) option for the first 2 years, and most state colleges are affordable. In my city/state, community college tuition is free for recent HS graduates or people who tested out of HS, and state college tuition is ~$9K per year.

  9. I mean in fairness it really isn't that hard to go to a college in the us for cheap or close to nothing if you were a decent student in high school.

  10. Most colleges in US won’t cost $120k. People take out $120k to pay for rent, food, computers. Some colleges have programs to subsidize costs in exchange for working on campus.

  11. Yes, they can be, 7% is rather common. What's going on with this guy is he has an income based repayment plan. That income based repayment plan results in a minimum monthly payment that will never pay off the debt.

  12. It works out to be about 3.5% of each payment went towards capital repayment - or exactly $33.33 out of $970. seems a bit unbelievable - and if that were the case the debts would only be hard to deal with if you pay the bare minimum - any cent over reduces the term substantially

  13. I think this guy is either lying or is getting omega shafted. Average interest rates for student loans in the US are sub 7%. With his math his rate would be in the realm of 9.5% depending on how accurate his numbers are, which is insane. At the rate he’s going it’ll take him 41 years to pay it off. I think he’s probably at least exaggerating a little bit.

  14. Student loans yes. Higher Ed in the US can get fucked. Tuition is so high that almost everyone has to get a loan and then loan companies charge usurious interest rates. Best we found on student loans was 8 or 9 percent and that was even with a perfect credit co-signer when mortgages were in the 3% range.

  15. That's actually a standard long term student loan. Likely no credit history when the loans were obtained, so higher rate. Amortization over something like 15-20 years is going to look something like this. I haven't cared enough to rhn actual numbers, but this is closer than you think to a normal loan.

  16. unless he's lying (he probably is) he borrowed $120,000 at approximately 9.4%. At his monthly payment of $970, it will take him over 37 years to pay it back.

  17. Post education is big business not about education anymore. Id never recommend unless it’s absolutely necessary.

  18. Or just choose cost over experience. It is much cheaper to go to a in-state public university and commute than it is to dorm at a private university out of state. But, so many people go to the dream school because of all the fun they think they’ll have and don’t think long-term. At the end of the day, unless you are a professor, no one will care what school you went to. Even starting at community college and then going to a private university can save so much money. You don’t even need perfect grades to qualify for a free associate’s at CC in certain states. And also, not switching majors can also save a lot of money. Pick a major, stick with it, and get out in 4 years or less. There are ways to do it without going into debt, people just choose not to.

  19. I'm not from America, just from Ukraine. so I could be wrong. But did someone force him to take a loan, are there no other ways of life in the US at all or what.

  20. I couldn't agree more. I hear the kids say they deserve the "experience" rather than looking for ways to save on it. Everyone in our poor family went to community college the first 2 years while working. NO debt whatsoever. It was about learning--not some bullshit party experience or wasting time on sports.

  21. What if you actually thought about it ahead of time? What if the cost factored into your college selection? You know like going public locally rather than private somewhere else. Going to community college for 2 years, before uni. What if you sat down and planned something? Instead of writing a blank check for it. For some reason, we have allowed colleges to create this fantasy and everyone has bought in.

  22. Yeah, the "college life" doesn't really mean anything. For some of my friends it was just stupid parties and wasting time in a generic/crappy degree that got them nowhere.

  23. Why would you have taken on 120k in debt for a college degree? In-state tuitions are so much cheaper, community colleges are so much cheaper

  24. My brother in law lived with his parents to go to local university and worked full time to get his electrical engineering degree. He never partied or took time off but he had no debt.

  25. 19k/yr is even on the high end for instate tuition! It’s 11k for my state. However, if you get a 3.0 in high school or better then the state covers your tuition (instate public only). It was fairly easy to graduate undergrad and grad school completely debt free in a STEM field

  26. If you factor in living expenses/rent that public education could be pretty close to 120k. And even a 50k loan can be difficult to pay down from the interest

  27. $120K is more than I paid for my first two houses and nearly what I paid for my current house. Hope he chose a field of study that is very rewarding because he’s going to be working a long time.

  28. Here is the world's smallest violin playing for you. I hope your degree is in a field where you don't have to ask "you want fries with that?" Two year trade school = mid 5 figures out of the box.

  29. Why not charge No interest on student loans all payments go directly to the balance borrowed if you complete the course?

  30. Tried to do some quick math on the side. If you do minimum payments every month (970$) it would take roughly 38 and a half years to pay off the full 120,000$ loan. If you were to pay 1,548$ a month instead (obviously not feasible for everyone but is definitely doable especially with a job that he could get with a college degree) then it could fully be paid off in 10 years. Paying the minimum means you are almost entirely paying off interest every month. If he wanted to pay the entire bill off in 20 years (much better than the projected 38.4 years) then he could simply pay 1,114$ a month. This number is less than 150$ more a month and would cut the number of total loan payments in half. This post is pretty misleading as the guy is paying off the minimum amount. Many students with loans will stay home with their parents and pay off all of their loans within 5 years or less ( or by simply having a bf or gf to live with that can help cover costs of living.) if you were to have a job making 60k a year (very doable out of college) you could pay it off in 3 years if all money is put to it. Obviously how long you take to pay it off is up to you. If you dont want to live with parents then plan to pay off the loan in 10-20 years. (Another side option that I know a few people have taken is joining the army. This allows for all loan payments to be covered by the government. This allows for people to do things such as undergrad, grad, and med school all for free rather than racking up 300,000$ of student loan debt)

  31. I wonder what the reaction would be if they just canceled student loan interest and you only had to pay back what you actually used. (The past interest payments would go toward the debt in this scenario)

  32. Because theyre 17 when they make this decision and have never had more than a few hundred dollars to their name before. They have no experience with large financial decisions with lasting effects, they dont fully understand the ramifications. Which is why it shouldnt be legal. This stuff isnt taught in high school, so unless they had parents guiding them, they would have no idea what theyre doing.

  33. This isn’t possible…did he pay for college on a credit card?? I don’t think even the worst and most aggressive amortization table on a shitty sub prime home loan is this bad. Can someone show an amortization and payment schedule that confirms or disproves this?

  34. I think most of these posts are fake. There’s demand for it on both sides. The left and cry and gnash their teeth and point to how unfair this is and the right can say, see how dumb this kid is, why’d he go to such an expensive school it’s clearly all his dumb fault.

  35. It’s impossible to do the schedule without knowing the terms and he intentionally hid those facts. The only way I can think to make this work is a 5 year loan at a high rate which he hasn’t made the full payment on. Like if he was supposed to be paying $2,000/month, yeah $970 is only gonna cover the interest.

  36. Literally just google loan calculator and you’ll see that $120k loan at 10 years and 10% will cost $70k in interest, most of which will be paid in the first half of the loan. That’s with a monthly payment of $1500. This is monthly payment of $970, meaning he’s doing income based repayment and almost nothing he’s paying is going to principal, and will take much longer than 10 years and much more than $70k of interest to pay off the debt. Don’t make minimum payments kids. And learn about how loans work prior to taking one out. Google is a helluva tool.

  37. Well to start, federal student loans don't use compound interest, so we can throw amortization schedules out, which makes the OP's claim super bullshit.

  38. Well it happened because they told an entire generation that the only way they can be successful is to go to college and get degrees. Took vocational classes out of high-schools and pushed everyone into colleges. Now everyone has degrees but not enough jobs. So you have people with really nice degrees doing absolutely nothing in their field. And the kicker is, those electricians or hvac jobs they took away from high schooler are now paying insane money because no one is there to fill the roles they need. Hell the local hvac guy made over a 100k just in the summer! Its kind of funny

  39. I think another factor people don’t think about is that to a lot of high school kids, learning a trade sounds fucking boring and depressing.

  40. Both of your rules are already in place for government loans. You took out a private loan from a bank, and the government doesn't and shouldn't have a say in those loans.

  41. I wouldn't forgive all student debt but the interest gained on it needs to be capped or limited - with reimbursements to anyone that has paid off their student loans. You borrow money, you repay it, not live under it for the rest of your life.

  42. The average cost of a 4 year degree is $32,000. How did you rack up 4 times that amount? The government shouldn't regulate your foolishness nor should the rest of the country be responsible for it but. Here is what's funny if you would have had a part time job since the age of 16 you would have been able to save up enough money to not only pay for your 4 year degree but also get a master's degree. Let's look at another way if instead of going straight to college in 18 you worked scrimped and aved as much as you could, You'll be able to afford college cash in hand by 22.

  43. This is possible because your a total loser. Only a complete moron would put them selves in this situation and then be shocked at the end of the day. Your a modern day slave to the people that own the papers on you. That would be the government “guaranteed” loans for higher education.

  44. What’s great about all the loan forgiveness is I worked 80 hours a week to put myself through school and am graduating this semester. So because I am smart enough to not take a predatory loan and am hard working enough to get through this shit on my own I’m out 80 grand. I’m happy for those of you who benefit from it but I’m pissed that my taxes are going towards these payments. Now I’m sure I’m going to be downvoted but please let’s discuss.

  45. Yeah I had no debt because during summer I worked 60-84hr weeks at a chemical plant in the summer while my friends partied it up and used their money to pay for vacations and fun. So I would have been a little disheartened to hear that they got a free pass while I sacrificed. I could understand interest free loan repayment but not forgiving the debt all together

  46. How was it ever legal? More like how was that contract ever signed? Don't blame other people for your mistakes. You went to the bank and said "Hey I want a loan!" Then they sat you down and told you everything about the loan. How much it was, how long you had to pay it back, how much the interest would be, ect. It's your fault for not doing your research before you took out and signed on a loan.

  47. Its with every other investment: does this 120k give me some sizeable return? There are people shooting for Netflix who went to a public film school for 4k/semester. There are people who can't get nothing done for nobody for years and went to NYU.

  48. I’ve heard that student loans are the biggest asset that the US has or something. I don’t entirely know what that means but it sounds like we’re being screwed over.

  49. You made that decision…what do you mean how can this be legal. No one forced you to take out a loan and get a degree.

  50. Well don’t go to college and bitch about ur choices….shoulda known about debt before u started and excepted it now ur begging everyone pay it for you.

  51. Unpopular opinion but f*ck it: how about we take some accountability here, you’re an adult after all. Also there’s something called a principal payment. Minimum payments don’t do shit.

  52. Thank god I never went to college. It took me until my 30’s to live comfortably but I’m not living paycheck to paycheck anymore and I enjoy my little apartment

  53. And now you want poor people, people who didn’t go to college, people who responsibly paid off their schooling, people who have their own families, people who are responsibly paying off their loans, to pay for yours.

  54. No one forced this person to go to a school that expensive. There are cheaper options but people would rather go into massive debt for the prestige of going to a "good" school.

  55. Dude needs to work on his math. I just ran several scenarios where 5 years worth of payments regardless of interest rates or loan terms from 10-25 years, 3-15% and he would have paid more than 2k. Obviously bullshit over exaggeration.

  56. Same here… if they took the interest rate to zero or 1-2% like they do for big business I could pay it off.

  57. Just make university free and then when you make x a year have an additional tax. That way the people using it pay it off the same they do now which is fair, plus the gov gets more money from all the rich people who can pay for university.

  58. you signed up for a loan?? are you mad you didn't understand what you were signing?? I mean I have a mortgage that works the same way.. all the interest loaded up from. are we cancelling my mortgage too? y'all wanted degrees and are mad you have to pay for them???

  59. I didn’t want the entire loan forgiveness program, I just wanted interest control. I struggled to get approved for a credit card with a $650 limit when I was 18 but I was able to sign up for $23,000 worth of loans with varying interest rates no problem. How is any of that able to be done? Set interest rates at a reasonable amount so they can actually be paid off instead of hanging over peoples heads for decades financially handicapping them.

  60. Quiet slave, we’ll have no more trouble from you whipcrack You thought being educated and serving humanity was the way to success whipcrack Serve your corporate overlords at the school, place of employment, and the banks, and do it with a smile whipcrack

  61. You are right. It should not have been legal to give you this loan. You should have been expected to pay for your education.

  62. Nobody made him go $120k in debt for a job that doesn’t pay enough to justify the degree. Make better financial decisions and complain about the cost of education being too high instead.

  63. Or even better stop paying for education. Learn on your own. Learning shouldn’t cost anything in the age of information

  64. While I agree that student loans are incredibly predatory and that something needs to be done to correct the horrible interest, I shouldn't have to pay for your decision to take a loan out.

  65. No offense but you signed up for that loan brother . There are solutions , I don’t really know what they are or what they could be for the future and I am not smart enough to elaborate lol … but me, and others who went to school and bought houses , cars and so forth with credit take on the responsibility of paying back what they owe, because it’s what you do as an adult , don’t live beyond your means and budget yourself . Fiscal responsibility is not always easy and decisions to take out loans for average middle class Americans sometimes seems like the right thing to do and unfortunately for some it puts them in a pickle . Nothing is free , same with knowledge , the challenges you put yourself through and responsibilities you take on by furthering yourself gets you to a point where you attain that knowledge or that skill set . But it didn’t come without sacrifice . Same thing with loans for things you want in life . Again this is just my opinion I don’t know if you or anyone else can relate . I’d love to hear other peoples opinions on the matter .

  66. cancelstudentdebt is basically saying #otherpeopleshouldpayformydecisions. You made a choice to spend money on college knowing this would be the outcome. Its not a secret. Time to take personal responsibility and use that continued education to pay off your own debt

  67. I don’t want to be in the “make better choices crowd” but how the fuck do people convince themselves that taking out $100k+ in loans for a bachelors is okay?

  68. Because you went to an over the top expensive school. Could have gone to a in state school for maybe 40K total. There’s your answer dumbass

  69. Being so monumentally stupid as to be making such small payments on such an enormous debt pile should indeed be illegal.

  70. You made a choice to take out loans. You were given the conditions of that loan. You now think you can just "Magically" make it go away. "Cancel" does not exist. Someone else would have to pay that debt. If you got one thing from college it should have been self-accountability.

  71. If only there were a way to figure how much the degree would cost and how much you could expect to earn with it and then do some 3rd grade math to see if it’s a good idea

  72. Cancel predatory loans. Cancel half the discretionary budget and provide states education grants so that anyone with desire and aptitude can get a Bachelors’ degree for free

  73. If you're not willing to live with making the payments, maybe taking out a loan that big in the first place was not a good idea.

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