Student Loans For College: Concerns About College School Loans And Their Repayment

Questions About Student Loans For College

Student loans for college have been used by millions to attend colleges and universities for multiple decades. Yet it seems that only recently that funding higher education through college school loans is being questioned.

In a way, it seems radical to question whether college loans for students should be questioned. You see, for decades, the financial aid office has been one of the first destinations for incoming students at even the best colleges and universities, at least in the USA.

College School Loans

First as a college bound freshman and then later as a parent of 2 university student, college school loans were seen as a wonderful way to fund a college education. I borrowed my way through college as did my wife and most of our friends. Then our kids did the same thing a few decades later.

And to be fair, I must say that it seemed at the time the only college payment game in town for low and middle class families.

But now I am looking back at the track history of borrowing for higher education and I have questions and concerns about the repayment of these student loans and the impact on the college graduates financial destiny.

I am convinced that our universities need to a better job of helping guide college payment so that a graduating senior has a ghost of a chance to succeed financially in life.

Best Student Loans

What would be the criteria to make it to in my list of the best student loans? For a college loan to be considered best, it would need to be easily repayable without financially ruining a graduate because of being in financial bondage for years and even decades.

Too often to be listed among the best student loans, the only considerations were low interest rates and low monthly payments, spread over a long period of time.

While that may qualify the loan as best from the lenders viewpoint and the university administrators too, is it best for the borrower to finance their education in such a way that they struggle financially just to repay for years to come.

If they can repay college loans is becoming more of a problem and some think the college lending industry is the next financial bubble to burst, at least here in the US. Unemployed graduates often find that they are still searching for work in their chose career when the loan payment start their repayment schedule.

Low Interest Student Loans

Back a few decades ago, low interest student loans meant 3% interest or less! I can remember that financial advisors would encourage student loan payments be stretched out for as long as possible because the interest was considered to be so low.

The main problem with student loans with even low interest is that it is one of many loans graduates have because consumer borrowing is so readily available for every need of life.

Students with these great student loan rages are encouraged to borrow for a car, finance new furniture, and oh yes, get a credit card or two. What is the result of this emphasis upon borrowing for everything imaginable? You guessed it, a consumer credit crunch at the least and a major depression at the worst.

Repaying Student Loans

Of course, if one cannot find work in their chosen field, they are told to add to the student loan debt by getting a masters degree, financed of course with graduate student loans.

Student Loans Refinancing

Finally, after all these college loans accumulate, there is the need for student loans refinancing. The of course means student loan consolidation. The college debt has reached the point of repayment impossibility.

Why the student loan consolidation option enters the picture is that at least at the time I write this article, student loans cannot be included in bankruptcy. I can remember a time when it was recommended by some to graduate one day and declare bankruptcy the next.

Fortunately, that was stopped or else the entire student loan program would have eventually collapsed, with no more funds available to borrow.

So is there a better way to finance an education than student loans for college? After all, college school loans have been the recommended way to fund higher education for decades. So what now?