http://www.salon.com/2015/12/06/stu...ix_that_could_save_our_college_grads_partner/
This weekend, Kevin Carey, head of New America’s Education Policy Program, penned a piece for the New York Times featuring the story of Liz Kelley, a parochial school teacher whose student loan balance has ballooned to $410,000.
As with most Times pieces on higher education, the piece has caused quite a stir (see here, from Don Heller at Michigan State; or the article’s comments section; or Twitter), and is serving as a kind of Rorschach test for people with opinions on college affordability and debt. Some fear that descriptions of anomalous loan balances accrued on loans provided by the federal government will lead to the institution of underwriting student loans—thereby limiting access to poor students or students who want to study in non-lucrative fields that provide a tangible (think social work) or intangible (think English) benefit in the labor force. For others, that would be a feature and not a bug.
ADVERTISING
But my takeaway from the article wasn’t that we should be underwriting student loans, but rather how weak and complex the backend protections are for people who do fall behind on their debts when life gets in the way.
Kelley, the article’s protagonist, managed to accumulate student debt from her undergraduate education at a private college, followed by a stint in law school and a graduate teaching program (including a brief time in a Ph.D. program), and finally through Parent PLUS loans after her children had maxed out their federal loan eligibility. Like anyone else who has been frustrated by high-interest private or graduate school loans, Kelley found her balance had spiraled upward due to hundreds of thousands of dollars in accrued interest. But she also faced some debilitating luck – including a rare medical condition, concentrated effects from the Great Recession, and a divorce – that left her unable to make a dent in her loan payments and forced her to cash out her pension fund.
See Link
This weekend, Kevin Carey, head of New America’s Education Policy Program, penned a piece for the New York Times featuring the story of Liz Kelley, a parochial school teacher whose student loan balance has ballooned to $410,000.
As with most Times pieces on higher education, the piece has caused quite a stir (see here, from Don Heller at Michigan State; or the article’s comments section; or Twitter), and is serving as a kind of Rorschach test for people with opinions on college affordability and debt. Some fear that descriptions of anomalous loan balances accrued on loans provided by the federal government will lead to the institution of underwriting student loans—thereby limiting access to poor students or students who want to study in non-lucrative fields that provide a tangible (think social work) or intangible (think English) benefit in the labor force. For others, that would be a feature and not a bug.
ADVERTISING
But my takeaway from the article wasn’t that we should be underwriting student loans, but rather how weak and complex the backend protections are for people who do fall behind on their debts when life gets in the way.
Kelley, the article’s protagonist, managed to accumulate student debt from her undergraduate education at a private college, followed by a stint in law school and a graduate teaching program (including a brief time in a Ph.D. program), and finally through Parent PLUS loans after her children had maxed out their federal loan eligibility. Like anyone else who has been frustrated by high-interest private or graduate school loans, Kelley found her balance had spiraled upward due to hundreds of thousands of dollars in accrued interest. But she also faced some debilitating luck – including a rare medical condition, concentrated effects from the Great Recession, and a divorce – that left her unable to make a dent in her loan payments and forced her to cash out her pension fund.
See Link
