RSS Facebook Twitter LinkedIn

Featured Advisor

Ed Meek
CEO/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

Click to see the full profile

Share |

America Sounds Off on Student Debt

Students, lenders, colleges, advocates – and even the military – want to reform the student loan industry. How would they fix the student debt crisis?

| BY Adriana Reyneri

Stakeholders in the nation’s looming student debt crisis - a group that includes students, lenders, colleges, financial advocates and even the military – see solutions in allowing student borrowers to refinance their loans at lower rates, student loan forgiveness and eliminating the private student loan industry altogether, according to a Consumer Finance Protection Bureau statement released today.  

The consumer-watchdog agency is accepting online comments on the student debt crisis through April 8, and has received more than 500 comments since February 21. Here’s a look a solutions proposed by diverse players:

A student: A 33-year-old woman, who graduated with graphic design degree and almost $100,000 in student loan debt in 2010, took years to find a job and is now making $13.50 an hour. Half her loans have gone to collection. She writes, “The thing that bothers me the most is not being able to have a family and a home. I have a friend who opened a few credit cards, went on trips to Hawaii and Vegas, then just claimed bankruptcy. I never thought it would be like this. When I was in the offices getting financial aid I never thought I would end up worse now than I was then.”

Unexpected medical expenses also contribute to the debt burden of young American adults.

The U.S. Navy: “The bank bailout ‘worked,” why not a student loan bailout? Buy out the loans from the private lenders. Give all these struggling people an extremely reasonable interest rate. Get rid of the private student loan sector entirely. You already guarantee the loans, so why not benefit from them? Give people either almost 0 percent  interest on loans or forgiveness … . The money that is freed up from being burdened with extremely high loan payments would be able to be spent by people who would LOVE to spend money in the economy. Homes, cars, furniture, electronics, etc.

A mortgage loan officer: “I have been a mortgage loan officer for 23 years. The amount of student loan debt has increased to the point that one-in-two first time buyer applicants for a mortgage have student loan debt. Of that, many of the loans are difficult to manage. Often the payments are too high to allow them to qualify for the home loan.”

Young adults lag behind in wealth accumulation, and may be the first generation in years to be poorer than their parents.

The University of Wisconsin: “Update existing loan underwriting to offer more repayment plans in addition to a standard repayment plan, even at the risk of increased pricing and processing fees. Require private student loan lenders to offer a consolidation loan and a refinancing feature for new and existing borrowers. Introduce a service-based private student loan forgiveness program that encourages volunteerism or public service work that benefits both the community and the borrower.”

Financial Advocates: “In our work providing free financial coaching we deal with colleges graduates who are paralyzed by student debt loads every day. First, student debt must be allowed to be discharged in bankruptcy court. The exemption makes no sense. There is no teeth in a government backed guarantee that will never go into effect because the loan will never be discharged. Second, debt should not play a role in financing education. A social insurance fund, like the notion of ‘pay it forward’ being proposed by the Working Families Party will enable students to attend public universities tuition free, and then upon graduation, then pay 3 percent of their gross income into the social insurance fund for 20 years.”