The Real Deal On The Student Loan Crisis
It is the dream of every parent to see their child graduate from college or university. After all, giving a child the ability to pursue a college degree is perhaps the most important legacy a parent may give to their child. However, recent trends in the government today have made this become harder and harder to achieve. Not only are more and more parents unable to provide their children the ability to enter the college and degree of their choice, but current college students have now become victims of changes in the government's legislation with regards to the support it currently gives to students who wish to attain a college degree.
An Overview on Student Loans
As of the 2007-2008 school year, the average cost incurred by students pursuing a college degree in any of thousands of public and private colleges and universities in the United States is about $50,000 a year. This cost includes living expenses, tuition fees and the various materials that a student would need during the school year such as books and other school supplies. This exuberant amount spent per annum by a college student has prompted many students and their parents to apply for a student loan to finance the student's college education until its completion.
Undergraduate college students and their parents may be able to choose from any of the three types of loans available. These are federal loans made directly with the government; federal loans coursed through a third party such as a bank or guaranteed lenders by the government and loans from private lending companies. The amount available to be borrowed, the expenses the loan may be able to cover and the corresponding interest rate depends on which particular loan that the student or the parent chooses to take out.
The Current Issue
For nearly a decade, the student loan program currently implemented in the country has become the subject of many debates. In an amendment done on the Higher Education Act (HEA) in 1997, student loans have become the only type of loan taken out that are no longer under the protection of bankruptcy legislatures on the part of student borrowers. This change had been brought about by efforts of student loan companies who had lobbied for this amendment based on the argument that student loans are the easiest type of loan that can be collected. As such, stricter penalties and fines were drafted to be imposed on student borrowers who fail to pay on time regardless of their financial situation. It also prohibited students to have these loans to be refinanced, giving students no other option but to pay up to four times the original amount that they have initially loaned.
What Can Be Done?
Just as it took a collective effort on the part of various private lending companies to have the legislation amended to their favor, students and their parents would be able to do the same. If you are one of the many victims of this change, here are a few steps that can help make a difference.
· GO TELL EVERYBODY . Privately ranting on your current situation would not do much help. Having your story published in your local newspaper and over the Internet would not only bring a voice to your concern, but it would also make other people aware of the growing problem being faced by people such as yourself.
Get Involved! There are currently a number of student and parent organizations that are now trying to make a collective effort to bring this concern to members of Congress and the Senate to look into this growing issue in the country