This is from the article...
"The Case for College Accountability Daily Finance's
Zac Bissonnette concurs, and argues prior to Lieber's New York Times piece that "Many colleges ... are signing naive students up for levels of loan debt that are destined for failure." When the financial aid offices do this, he argues, "the schools should at the very least share in the financial fallout." "
Now... I am all for holding some people to the fire... but let's take a look at the lady in question... Sallie Mae stopped loaning her money... should they take a hit?
The financial aid office does not get any 'income' from the loans... the students are paying for their college just like the ones who are paying cash... so there will need to be a charge to the students who use student loans to pay for their tuition to pay for the deadbeats...
And then do they get hit if they kick someone out and they now can not get a job.. back to our example... if the school kicked her out with 'only' $60k in debt, saying she can not have anymore at their school... and now she does not go to ANY school... do they get paid for what at the time was reasonable debt?
The problem is the rules are set up for someone to borrow that is NOT credit worthy... nobody will lend big sums of money to someone that does not have any means of paying it back (ok, start with the jokes about the subprime mortgages... I can take it
) ... so, you put the full burden on the student...
And even then... there are a number who do not pay... ever...
I think a good suggestion... and I just thought of this... so maybe it will be stupid... but why not limit the amount that can be lent to say... 2X the 'state tuition' amount... so, if you can go to State U for $18K, then the max you can get is $36K (sounds to high... maybe 1.5X... or even X...)... then, if you want to go to a high cost school... you either get grants, scholarships or scrounge around for the money... this will limit the max debt for eveybody...