Self-Education: All You Need to Know about Student Loans

Back in a day, student loans were super beneficial and easy to pay out. Now, they became so evil that you can get stuck for life. How come?

Let us play an association game. I say you a word, and you need to tell the first thing that comes to your mind. So, our first word will be a “rip-off”. Who thought of a college student loan immediately? Probably, most of you because this is one the most ingenious financial schemes in the US and you have no idea how much money final beneficiaries get. Are we going to continue with the game? Not really, I guess a conversation about loans does not settle a playful mood. There is a chance that this article will make you think of student fees even worse than you used to, so prepare to be amazed.

1. 1. Do We Really Need to Apply for a Student Loan?

Back in a day, a system of student loans was much more transparent. Everybody knew what they were paying for and when the day would come, they can scream from the top of their lungs “Freeedom” just like Mel Gibson’s character did in “Braveheart”. If you think about it, those student loans have an honorary mission, they are making higher education more accessible for various social classes. They were meant as a tool which would serve students well and make their dreams about a future profession come true. What could possibly happen on a historical timeline that this initially beneficial idea would turn into such a disaster and became a source of your severe anxiety and financial insecurity? We will tell you about this unfortunate turn of events but let us take a look at the modern state of things to get a full picture.

Students loans are a necessity, and it is absolutely true that many people would not be able to get a higher education without them. That is why companies who loan you money feel omnipotent, they know they control your life, and there is nothing you can do about it, you are absolutely powerless. According to 2018 official data, 42 million Americans have student loans which together form a humongous amount of money, $1.3 trillion to be exact. And for now, it is the biggest one in history.

Does it mean that more people have started entering universities or loans have just got bigger and eviler? Anyway, those loans for college are just something crucial, and they do help you to get a ticket to a better life at some point. It would be a bummer if you got expelled only because you fell behind in your grade-level. Here is what you can do about it. Whenever you feel like you can’t handle such a homework overload, just address a reputable website by visiting the following page https://coolessay.net/essay-writing-service.

1. 1. College Loans for Students: How the Whole Story Began

By the year of 1972, a practice of giving student loans had already existed in the US, however, it was not that tremendously popular. Mostly because the budget was incredibly limited and students could only get an amount of money that was not able to cover all their expenses on higher education. Obviously, it was unfair.

1973 became a year when a miracle happened, and a company that was willing to give significant sums of money to students appeared. If you are an American, you must have heard about the Student Loan Marketing Association or, perhaps, you will recall that it is often referred to as Sallie Mae. This corporation started buying loans from banks, so these financial institutions would provide Sallie with even more money. This whole operation was under close government scrutiny, so at first, it was working like a dream.

This great effective system that enabled so many smart students from lower social classes to enter colleges started falling apart in the 1990s after the government had decided that it was time for Sallie to be privatized and that was the moment when the hell broke loose.

To be honest, a student loan is such a profound theme that can easily be used for your Capstone project.

1. 1. Free Market Is a Prison for Students

In this particular case, it is not just a prison, it is cruel solitary confinement that you will get to leave only in twenty or thirty years depending on the loan term. President Clinton came to an agreement with Republicans, and Sallie Mae became an independent corporation that was able to make a profit. As it often happens, there was no limit of its greediness. And the marketing game began. So, remember, kids, it is always about advertising. Sallie Mae started proposing money to colleges for ditching governmental loan programs and switching to their rip-off madness.

The worst part is that students do not get to choose a type and a sum of loan anymore, Sallie Mae`s conditions are being imposed on them and they are forced to take loans that they can’t even afford. How come? You are a rational human being who reads documents before signing them, right? So how could you get tricked into this? There is evidence that Sallie Mae corporation has its representatives on college loan hotlines and they convince you to agree to anything.

1. 1. Personal Loan for College: A Financial Pit You Are Jumping Into

One in four American borrowers is behind on their loan payments. And the worst part is that at first, it seems that monthly payments are super low and they do not have a negative impact on your overall financial situation. However, soon you realize that these payments do not even cover the interest, so you may be paying for years and that sum of money you owe may still be the same. Hold on, it was not even the worst part.

Let us say, you are not able to pay, you are bankrupt. Usually, when you can’t return a loan, you can default. But if you choose this path with a student loan, half of your income will be taken by the government. By the way, it is nearly impossible to file for bankruptcy. So, you get stuck for life.

What should you do? Are you looking for tips for paying off student loans or forget about higher education at all? First of all, you have to know the answer to the central questions – how do student loans work? How do you apply for a student loan and what are the deadlines? What types of loans are available? How to get loans for college? And how much should you borrow? Believe us, when it comes to the student loan, research plays a huge role.