Senior citizens have $36 billion in student loans

[Ross]

The Feds must be really hurting. They didn't care about this piddling sum from this "Beggar-Thy-Neighbor" until now decades after the fact? I wonder how is this all gonna pan out for today's students with much higher cost's?

Senior citizens have $36 billion in student loans.
By Liz Goodwin

New research from the New York Fed shows Americans 60 years and older owe a collective $36.5 billion in outstanding student loans. More than 10 percent of these indebted seniors are delinquent on their loans, which means they may field calls from persistent debt collectors and be forced to offer up parts of their Social Security checks to satisfy their decades-old debts, the Washington Post reports.

Most people with student loans are under 40, but because this type of loan cannot be discharged in bankruptcy, the debt can follow a person around for life. The average amount due from all student loan borrowers is $23,300, according to the New York Fed's data, while the median amount is $12,800. On average, college graduates make significantly more over their lifetimes than high school graduates and face a lower unemployment rate. But college costs have skyrocketed over the past 30 years, and the potential payoff of a college education varies widely, depending on which subject a person majors in and the value and reputation of the college.

http://news.yahoo.com/blogs/lookout/senior-citizens-36-billion-student-loans-150451374.html

[redcliffsw]

That's another way the Fed's have been subsidizing the Education lobby.
Been going on for years. 

Might be why somethings like "Not Yours To Give" are not taught in public schools.

[Ross]

The Student Loan Crisis Everyone Saw Coming
President Obama has fought hard to ease the student-debt burden, but Republicans threaten his fragile gains.
April 6, 2012 |

When there are Americans whose Social Security checks are being garnished to pay off their outstanding student loan debt, then it is clear that the United States has a problem. And the rising number of seniors who haven't paid off loans taken out decades earlier is only one of several reasons to be alarmed by a report on student loan debt released by the Federal Reserve Bank of New York in March.

Total debt, as of the end of the third quarter of 2011, had reached $870 billion, a number, the Fed was quick to point out, that eclipses what Americans owed on their credit cards and on their auto loans. According to a more recent report from the Consumer Financial Protection Bureau (CFPB), the amount currently owed on both federal and private student loans has already broken the trillion-dollar barrier.

That's not just bad for the people struggling to pay off their debt — people who, according to CFPB student loan ombudsman Rohit Chopra, are being punished for "doing exactly what they were told would be the key to a better life." The burgeoning debt numbers also pose a growing threat to the larger economy: money spent paying back student loans is money that isn't stimulating overall economic growth. Who will dare risk becoming a first-time home-buyer, for example, or buy a new car, when still struggling to pay back thousands of dollars on their education?

The Fed and CFPB reports launched a new round of well-deserved hand-wringing about the student loan "crisis." But one of the things that makes this crisis different from previous financial disasters — like, for example, the subprime mortgage debacle — is that it actually hasn't been ignored. In fact, you can make a good argument that the Obama administration has tackled the student loan crisis vigorously from the get-go, and achieved some signal triumphs, even while being ferociously opposed by Republicans at every single step of the way. Judging the overall success of Obama's efforts is tricky — it may take many years for Obama's reforms to make a dent in the overall quantity of outstanding debt — but there is little question that the White House is trying, and that for some students, at least, it has become easier to pay the bills.

The story of how President Obama has worked to help borrowers pay off their student loan debt and ease the path to affording a college education is a case study in how the current administration has worked to fix a broken system in the context of a political process that makes achieving any kind of progressive change almost impossible. And it also illustrates how the hard-won successes already achieved are extremely vulnerable. If, for example, Republicans take control of the White House and the Senate this November, and follow up by implementing the agenda outlined in Rep. Paul Ryan's proposed budget, the impact on struggling student loan borrowers will be severe. One of the few fronts on which the Obama administration can claim to have made real progress would suddenly turn into yet another retreat.

The story begins in July 2009, when Education Secretary Arne Duncan announced a number of changes to how the federal student loan program operates. Interest rates on existing student loans were cut almost in half, from 6 percent to 3.4 percent. More important, Duncan introduced a new way of paying back loans, called "income-based repayment." Previously, student loan borrowers had to pay back a set amount each month, regardless of how much they were earning. Under the new system, borrowers only had to pay 15 percent of whatever income they were making, and if, after 25 years, they still hadn't paid off their loan, the remaining debt was written off.

http://www.alternet.org/news/154899/the_student_loan_crisis_everyone_saw_coming/