You must Sign In to post a response.
  • Category: Miscellaneous

    Are student loans exploitative?

    The student loan discussion is maybe one of the most controversial topics in the country. While most of the students admit that obtaining money through student loans is the sole way they can manage to pay for college, many see it as quite an excessive burden to repay those loans after graduation. New York State is examining its way of giving free tutoring.
    They are thinking of doing it in exchange for educational progress and post-graduation residency; students in other places have to deal with the prevailing borrowing situation.

    The biggest blunder is waiting too long to get any post-graduation action. In the first months of managing their financial situation, immature adults may not understand how swiftly they are getting themselves into a dark financial hole. They fail a payment one or two times, thinking that it is no big deal, and don't take any effort to address the condition. That is when everything starts to get out of hand, and they find themselves facing a situation where they have borrowed more money than they need to repay. Student loans can offer great support, but consider its consequences before you go for it.
  • #701810
    Taking educational loans is easier nowadays but one must keep in mind as how one is going to repay it. Those students who do not get a job immediately after their completion of the courses may face this big challenge.
    Knowledge is power.

  • #701815
    Yes we are undergoing the ordeal of repaying loan taken for my son Btech education and though the Bank has paid 2,40.000 for years as of now the balance stands at 3.06,000 and before even repaying any amount the banks is charging interest and compound interest on the loan taken. Though the loan was timely and helpful but the repayment has started few months back and he is paying 4000 per month and in that 2200 going towards interest and 1800 being deducted from the principle amount. But the same banks are taking easy on big loans given to the default payers and they are not even asking for their repayment and in fact waiving off as bad debts. Education loans should not be with whooping interest and RBI must reign upon the banks to consider nominal interest for the sincere pay back customers.
    K Mohan @ Moga
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #702175
    Those who do not do homework before taking education loan may feel that they are exploited. But the real truth is different.
    Education loans are mostly unsecured loans to banks. Hence they carry higher interest. Moreover there will be some gap from first date of availing loan and start of repayment by getting a job. Hence, when the repayment starts there will be a good amount to be repaid with accumulation of interest.
    So only those who really and absolutely need a loan and who reasonable expect a reasonably paid job without delay after completing the course should take education loan. Otherwise there is chance that it becomes a sort of debt trap.
    You may read the article How To Be Prudent To Avoid Education Loan From Becoming A Debt Trap

  • #702181
    Any loan is to be taken only when it is an absolute necessity. The rate of interest appears to be high but the banks have to charge as per the RBI guidelines and there will not be any surety also. So when we have to pay back the loan we feel we are paying a high rate of interest.
    But they are very useful to the people who have the merit but who don't have enough finances. They may pay a little more as interest but that loan has given a lot of scope for getting higher posts and higher earnings. When you compare your income with the interest you have paid, it will be very negligible.
    But the government should encourage poor students to go for higher studies by giving loans with no interest or a very minimum rate of interest.
    My complete education is in government institutions and I got a scholarship from my intermediate till I complete my PhD. So I have not taken any loan. I have also not taken any loan for the education of my two sons.

    always confident

  • #702208
    Education loans are helpful to pay the college fees to complete the education. So the persons who are choosing educational loans should check out for placement options too.
    Government has to provide special interest rates for prompt payers.

    Lead the leader

  • #702218
    Students loan are so common nowadays and even parents are encouraging their children to go for it as they feel that after getting a job it can be repaid soon in instalments. So, it is a conscious decision.
    Thoughts exchanged is knowledge gained.

  • Sign In to post your comments