I’d be cool with it if student loans didnt have any interest attached to them.
This was actually a really great post in its something that could help people without being a handout per se.
I can't fact check facebook posts but I also an interesting one that allegedly threw out real numbers
According to the post, and again I can't fact check it.
This individual's current loan numbers:
Current monthly payments: $1,062.45
# of payments made: 124 (10 years 4 months)
Total amount paid: $131,743.80
Original balance: $175,890.61
Total current balance: $175,898.71
^ currently owes $8.17 more than original balance
If this sort of thing is true and happening there needs to be some drastic changes to the loan process. Nobody should have paid $131k into a 175k loan to go to school and still owe another 175k.
And there's just a ton of confusion regarding how income based payment plans actually work. I have no clue. I'd love to see somebody with direct knowledge chime in here.
"Many people are on income-based repayment plans, which are made up of payments based on their previous year’s taxable income. These payments are calculated and decided upon by the student loan company, and rarely cover the interest due. The amount left over gets compounded and added to the principal, which adds to the total value of the loan. The next month that person is paying the same “income based” payment, on a loan that is now valued higher than the month before, which in turn has a higher amount of interest, which is again not covered by the income based payment, and is compounded onto the value of the loan… and so on."
^No clue if that's true as well but certainly wasn't how it was explained to me a couple years ago but heavily pushed.