The Am Law Daily
October 11, 2012
6. October 12, 2012 09:18 AM
This is an excellent article Matt, and really needs to be on the top of the list of things to consider before any student enters law school.
Would those unable to repay their law school loans back be part of that 47% that Romney recently referred to? We can't blame victims here since they took loans to go to school to better themselves. It's an unfortunate misallocation of resources.
Allowing student loans to be dis-chargeable in bankruptcy would force student lending to change underwriting standards. The Federal loan program could no longer blanket guarantee all Stafford loans as it currently does. Some people would simply be denied their loans. But the challenge would be what criteria to consider on an approval or denial of a federal loan? GPA? Major? School Choice?
Also interest rates would have to price in this additional risk of bankruptcy so they would have to increase.
This article is just the tip of the iceberg when it comes to this topic.
Also, you mentioned that private student loans can carry high rates. This is true for many, but not all individuals.
My company specializes in providing a private student loan consolidation to help get a lower rate and eliminate debt. We are backed by not-for-profit credit unions that really want to help recent graduates: http://www.custudentloans.org/our-loans/cugrad-private-student-loan-consolidation/
— Ken O'Connor
7. October 12, 2012 02:55 AM
I recall an article when Bill Clinton was President that he participated in a Yale plan similar to this and did not complete paying back his Yale law school debt until he was President.
— dan borinsky