Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W...
by joe_the_user on Wednesday December 11, 2019 @03:23AM
(#21760582)
If I take out a loan in order to go on a cruise, the cruise company is not responsible if I default.
Aside from the other points, this isn't an honest of the overall situation of industries and credit. For example, The real estate industry and the car industry are highly focused on the buyer's ability to pay. The company might not be legally responsible for a buyer who defaults and it may a different company making the loan but the entire industry has to take a hit and they avoid taking those hits when they can (periodic easy-credit situations can distort this but still).
Which is to say that the government giving student guaranteed credit for school certainly distorts things relative to other industries (even compared to housing, where the government is also involved heavily).
Re:Student Loans a Lot Like the Subprime Mortgage Debacle, W...
by sokoloff on Wednesday December 11, 2019 @07:03AM
(#21761674)
In my experience, those two industries are highly focused on the buyer’s ability to qualify for the loan and much, much less concerned with the ability to pay the loan.
Aside from the other points, this isn't an honest of the overall situation of industries and credit. For example, The real estate industry and the car industry are highly focused on the buyer's ability to pay. The company might not be legally responsible for a buyer who defaults and it may a different company making the loan but the entire industry has to take a hit and they avoid taking those hits when they can (periodic easy-credit situations can distort this but still).
Which is to say that the government giving student guaranteed credit for school certainly distorts things relative to other industries (even compared to housing, where the government is also involved heavily).