Two Grouchmeister Articles Worth Reading
And no, I didn’t write them. *sticks tongue out*
Aside: I am not so grouchy anymore today. Halloween was slightly more than I wished to spend, but still coming to about $38.00 including appetizer, dinner, beers, safe metro and bus rides, and then someone else buying some more cider and a shot. The conversation ended up being key as my friend was also a grouch and boy, did we need the drinks. (Piratz Tavern in Silver Spring is highly recommended. Service is still a tad slow, but the bartenders are excellent and the kitschy pirate decor is fun. Get the cod fritters and the bison burger!)
Anyhow, onto the articles:
The first is from Free Money Finance and how he’s sick of hearing about burdensome student loan debts. I agree that I’m sick of hearing about it as well. I agree with FMF taking on student loan debt is foreseeable and preventable. There are a great many ways to make undergrad and graduate studies more affordable. But if you read my comment, you’ll also see that I agree with some of these former students and I would like to know why the heck college is getting so expensive. Even in-state tuition is getting expensive, thus taking away an affordable option for many students for a first-rate education.
The second is from Justin McHenry at The Personal Finance Weblog and how he’s sick of hearing about ARM sob stories. Again, I agree with him because I’m a Ranty McRant Pants, but also because he has a point. Why isn’t his rate getting lowered for being a good borrower and paying his loan promptly? Why are we rewarding bad behavior? So what if Countrywide renegotiates the terms of the ARM? What if they extend favorable rates for 24 months? Does that mean the borrower will still be able to cope with a mortgage that readjusts in 2 years? Probably not. If they were foolish enough to take on the mortgage they couldn’t afford in the first place, who is say they have learned their lesson and will be able to pay an ARM with rising rates in the future?
Now I understand why on a macro market level why we need to do something about lots of defaulting mortgages. But very few people have said that we need to ensure that borrowers truly understand what they are getting through sound education.
Very few people have said we need to crackdown on liar loans and shady mortgage brokers. Fraud charges need to get filed against people who have knowingly duped the banks. Having been part of a federal fraud investigation by a flipper, I believe there isn’t enough oversight to catch collusive business practices between borrower, broker, appraiser and settlement attorney.
I think the banks are idiots for not reviewing their risk models more closely. Is everyone an effing Yes Man there? It’s a known fact that in real dollars, wages are falling, so why on earth would a bank think that making extremely risky loans to people who will be earning less in the future is a good idea?
I’ll right. I’m done.
Dean J wrote:
My in-state tuition at a state school is under $250 a credit, which is pretty darn cheap. $750/course makes it about $25k for the Bachelor’s.
My private tuition, previously, was $1200ish a credit, late 90’s. On the other hand, I’ve financed that out at 3.25% over 15 years, and as long as inflation stays *over* 3.25%, I intend to let that ride without thinking about it…
Posted on 01-Nov-07 at 11:11 am | Permalink
Sistah Ant wrote:
I think the problem with student loans is that you can’t expect 18 year olds with minimal financial education to know what they’re doing out there. Or 22 year olds for that matter. I’m not saying don’t hold them accountable. I’m saying give them the ability to rise to the responsibility by educating them.
I don’t complain about my student loans because I knew what I was getting into.
Posted on 01-Nov-07 at 11:17 am | Permalink
Mrs. Micah wrote:
Sistah Ant has a good point. It’s hard for a young person to make good financial decisions without an education. Not that some people couldn’t make better decisions, but I don’t know if they can be expected to make the best decisions.
Posted on 01-Nov-07 at 12:24 pm | Permalink
thisisbeth wrote:
Who should be repsonsible for educating 18-year-olds? Some 18-year-olds understand all this when they take out loans, and some don’t. Perhaps colleges should give tests about personal finance, and if you pass, you get x credits, and if you fail, you’re required to take an x-credit personal finance class.
Posted on 01-Nov-07 at 1:46 pm | Permalink
mapgirl wrote:
Pardon me. But am I the only one that sat through a loan/financial aid class with the Financial Aid office from my college?
I distinctly remember being giving a package of information from Citibank about loan consolidation, payment plans, etc. It was well after the fact, i.e. during my senior year of college and not before I had contracted to take the loans in the first place, but I had to sign something that said I knew what I was doing with my loans.
Are schools not doing this anymore with students?
Posted on 01-Nov-07 at 1:58 pm | Permalink
Money Blue Book wrote:
I actually enjoy reading someone else’s rants
I’m a vulture stock and real estate investor who wisely and luckily missed out on the boom so I’m definitely opposed to any bailouts. I’m waiting to catch their property after prices tank by half. Dang I sound evil.
Piratz is nice..I actually live pretty close to it.
Arrrrr right I’m done
-Raymond
Posted on 01-Nov-07 at 2:00 pm | Permalink
English Major wrote:
Mapgirl, I’ve never heard of a school doing a seminar of that kind. My college friends with loans certainly didn’t get that kind of help.
Posted on 01-Nov-07 at 2:42 pm | Permalink
Athena wrote:
Don’t these students parents help them understand what they’re getting into?
Also, isn’t learning about the terms of one’s financial obligations just common sense? If someone can graduate from high school and get into a college, I’d assume they’re not mentally challenged — it really isn’t rocket science. Hate to sound snarky, but it really seems that simple.
(I went to two colleges and took almost 7 yrs to pay off my loans. But college costs far less where I’m from.)
Posted on 01-Nov-07 at 8:56 pm | Permalink
FMF wrote:
I’m trying to be less grouchy too.
Posted on 02-Nov-07 at 6:43 am | Permalink