bail-out-students

Have we heard the first pop in a bursting student-loan bubble? After Santa Ana, California-based Corinthian Colleges this month filed for bankruptcy and announced the closure of its remaining for-profit college campuses, talk in Congress and the Legislature has revolved around proposals to bail out student debt for as many as 16,000 students.

Financial analysts have for years warned about the parallels between easy student loan debt and the easy mortgages that led to anartificially inflated housing market in the mid-2000s, and the resulting price drops and foreclosure bonanza. Maybe it’s time to reignite those discussions.

“Corinthian’s meltdown began last year after the U.S. Education Department reduced its access to federal student aid,” reported Bloomberg News. It sold half of its 107 campuses “amid allegations that it falsified grades, attendance and job-placement rates.” The company denies allegations and blames state attorneys general — including California’s — for legal action that made it tough to sell the other campuses.

Under federal loan rules, some students may be eligible for loan forgiveness — at a possible cost of more than $200 million to taxpayers. But the attorneys general, some U.S. senators and a group of protesting Corinthian students dubbed the “Corinthian 100” are pushing for a broader loan-forgiveness package that could cost as much as $1.5 billion.

Democratic and Republican leaders of the California Assembly in late April announced legislation that would waive community college fees for these students, provide them with legal assistance, offer “tuition recovery” to many online students, and create a “Closed Schools Task Force” to help them get back on their feet.

Some critics blame the for-profit nature of these colleges, but in other parts of the country some for-profit colleges are simply turning themselves into nonprofit colleges — and that allows them to get an even higher percentage of their revenues from the government (100 percent rather than 90 percent, according to a Miami Herald report).

The basic allegations: Many schools would use the hard sell to sign up students — often lower-income people, minorities, veterans and vulnerable people — and make dubious promises. The students would be in debt for iffy degrees, and the schools would rake in billions in profits.

No question, the students in the Corinthian situation in particular are left in a bad situation. Their credits are not easily transferable and they are stuck with questionable or unfinished degrees. But loan forgiveness could create a wave of bailouts that ripples across the nation’s educational system. Economist Richard Vedder argued in The New York Times that such a policy only “encourages students to borrow excessively, thinking they will not have to repay loans.”

If bailouts are problematic, what are other solutions? Some critics want tougher standards for the accreditation agencies. (That, too, offers echoes of the housing bubble given allegations that rating agencies failed to adequately warn about the condition of some of the nation’s mortgage lenders.)

Others blame federal education officials for taking so long to clamp down on Corinthian. The problem might even work itself out. Money/CNN reported that enrollment at the University of Phoenix, the nation’s largest for-profit college chain, dropped by more than 50 percent in the last five years amid bad press about for-profit colleges.

President Barack Obama argues community colleges, the obvious alternative for students pursuing career training, should offer free tuition to pick up the slack. But one reason for past growth in for-profit career colleges is community colleges are priced so low they are overrun with students, who often cannot get classes they need in a reasonable time.

These ideas miss the core problem. Corinthian collapsed after federal officials turned off the loan spigot, given that its business model was based on free-flowing federal loan money. Even the nation’s most prestigious university systems are ultimately funded by student loan debt, which may be why many of them have massive bureaucracies.

Debt-related problems have emerged first at these controversial for-profit institutions, but how long before a deflating loan bubble affects the nation’s entire higher-education system?

The Way Out

For those of us suffering from extreme debt, it seems an impossible mountain to climb. As a result, we close our eyes and hope it will go away. Likewise, those who wish for future riches also close their eyes and hope it will come to them. We either hope Obama will bail us out of our student loans, or we will win the lottery, or someone will discover us in a coffee shop and turn us into superstars. None of these things will happen. There are only three possible outcomes when dealing with large debt. You will either be saddled with that debt for the rest of your life, you will start a business or create a product which you will make money from and pay your debt off quickly, or you will chip away at it piece by piece until one glorious day, it is gone. Those are your choices. Forget everything else. Don’t make excuses, don’t try to say “Well, my dad will take care of it.” If your dad is taking care of your loans, you were never burdened by them in the first place, and this post is not for you. Here’s what you need to do-

Find something you enjoy doing, which other people enjoy as well.

Take what you enjoy, and spend 15 to 20 minutes researching it to see if anyone has capitalized on that market. Ideally, you would be right at the front of a new craze, so you could be the only source of information on it for a while. If you don’t know what you enjoy, you are wrong. People are making money from any and everything. Say for instance, the only thing that comes to mind is that you love Cheetos. Look on youtube. 

https://youtu.be/7YLy4j8EZIk

This video has over 10 million views. If that video is monetized, which I’m sure it is, that owner has made thousands upon thousand of dollars on it. 

Maybe you’re really into the Serial podcast. (I am pulling my hair out waiting for the next season) Make a podcast about that podcast! Get together with a friend who also enjoys that podcast, and discuss each episode as it comes out. You can listen to other podcasts and find out what companies are sponsoring podcasts, and contact those companies and ask them to sponsor yours! 

Perhaps you know a LOT about World of Warcraft. Write an ebook explaining the most efficient way to level up your character. Go on Fiverr and find someone to design a cover for your book, and publish it on amazon!

You can also start a blog, a youtube channel, publish on amazon and start a podcast, and use each of them to advertise for the other. 

FINAL WORD

Making money on the internet is not just the title of half the mail in your spam folder. It’s a real thing, but it’s not an easy thing. You need to keep at it, and you have to be ok with the fact that you will not get instant gratification. Make money from ads and book sales. Create the best product you can, regardless of what it is. If you want to make oven mitts, make the best, coolest oven mitts on the internet. Grind away at it until you get some money coming in. The first money you get will probably be under a dollar. Keep creating, and it will grow. 

I truly wish you the best of luck, these are all things I’m working on right now, and you can always see my debt at the top of this page. Sometimes it goes up, sometimes it goes down. Such is life…..

Follow Me <3


Is the Student Loan Bubble Starting to Pop?

Is the Student Loan Bubble Starting to Pop?

By Steven Greenhut Have we heard the first pop in a bursting student-loan bubble? After Santa Ana, California-based Corinthian Colleges this month filed for bankruptcy and announced the closure of its remaining for-profit college campuses, talk in Congress and the Legislature has revolved around proposals to bail out student debt for as many as 16,000 students. Financial analysts have for years…

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Is the Student Loan Bubble Starting to Pop?

Have we heard the first pop in a bursting student-loan bubble? After Santa Ana, California-based Corinthian Colleges this month filed for bankruptcy and announced the closure of its remaining for-profit college campuses, talk in Congress and the Legislature has revolved around proposals to bail out student debt for as many as 16,000 students.

Financial analysts have for years warned about the parallels between easy student loan debt and the easy mortgages that led to anartificially inflated housing market in the mid-2000s, and the resulting price drops and foreclosure bonanza. Maybe it’s time to reignite those discussions.

“Corinthian’s meltdown began last year after the U.S. Education Department reduced its access to federal student aid," reported Bloomberg News. It sold half of its 107 campuses "amid allegations that it falsified grades, attendance and job-placement rates.” The company denies allegations and blames state attorneys general — including California’s — for legal action that made it tough to sell the other campuses.

Under federal loan rules, some students may be eligible for loan forgiveness — at a possible cost of more than $200 million to taxpayers. But the attorneys general, some U.S. senators and a group of protesting Corinthian students dubbed the “Corinthian 100” are pushing for a broader loan-forgiveness package that could cost as much as $1.5 billion.

Democratic and Republican leaders of the California Assembly in late April announced legislation that would waive community college fees for these students, provide them with legal assistance, offer “tuition recovery” to many online students, and create a “Closed Schools Task Force” to help them get back on their feet.

Some critics blame the for-profit nature of these colleges, but in other parts of the country some for-profit colleges are simply turning themselves into nonprofit colleges — and that allows them to get an even higher percentage of their revenues from the government (100 percent rather than 90 percent, according to a Miami Herald report).

The basic allegations: Many schools would use the hard sell to sign up students — often lower-income people, minorities, veterans and vulnerable people — and make dubious promises. The students would be in debt for iffy degrees, and the schools would rake in billions in profits.

No question, the students in the Corinthian situation in particular are left in a bad situation. Their credits are not easily transferable and they are stuck with questionable or unfinished degrees. But loan forgiveness could create a wave of bailouts that ripples across the nation’s educational system. Economist Richard Vedder argued in The New York Times that such a policy only “encourages students to borrow excessively, thinking they will not have to repay loans.”

If bailouts are problematic, what are other solutions? Some critics want tougher standards for the accreditation agencies. (That, too, offers echoes of the housing bubble given allegations that rating agencies failed to adequately warn about the condition of some of the nation’s mortgage lenders.)

Others blame federal education officials for taking so long to clamp down on Corinthian. The problem might even work itself out. Money/CNN reported that enrollment at the University of Phoenix, the nation’s largest for-profit college chain, dropped by more than 50 percent in the last five years amid bad press about for-profit colleges.

President Barack Obama argues community colleges, the obvious alternative for students pursuing career training, should offer free tuition to pick up the slack. But one reason for past growth in for-profit career colleges is community colleges are priced so low they are overrun with students, who often cannot get classes they need in a reasonable time.

These ideas miss the core problem. Corinthian collapsed after federal officials turned off the loan spigot, given that its business model was based on free-flowing federal loan money. Even the nation’s most prestigious university systems are ultimately funded by student loan debt, which may be why many of them have massive bureaucracies.

Debt-related problems have emerged first at these controversial for-profit institutions, but how long before a deflating loan bubble affects the nation’s entire higher-education system?


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Is Student-Loan Bubble Starting to Pop?

Is Student-Loan Bubble Starting to Pop?

By Steven Greenhut

Have we heard the first pop in a bursting student-loan bubble? After Santa Ana-based Corinthian Colleges this month filed for bankruptcy and announced the closure of its remaining for-profit college campuses, talk in Congress and the Legislature has revolved around proposals to bail out student debt for as many as 16,000 students.

Financial analysts have for years warned…

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