website for student loans

the federal government will make awhopping $127 billion dollars of student loan debt in the next decadethat's because the high interest rate on the student loans now i should note thats federal student loans have a lowerinterest rate than the interest rate that they they would get from banks but they're still making a ton of moneyof students anyway something that makes us senator-elect elizabeth warren veryvery upset now i this program produces a profitbecause the interest rate paid by borrowers

exceeds the federal government's cost tofund those loans and administer the program now i should note that the total studentloan debt has actually doubled since 2007 and that'sbecause tuition has increased and its harder to get low-interest loansand also still on profits are used to fund the federal government generally rather than specific programs let megive you a breakdown of the interest rate so you understand why thegovernment is making such a huge profit so the average undergraduate borrowerwill pay 5.7 25 percent

to borrow from the federal governmentnow this is in 2015 and in 2015 the interest rate actuallyincreases these are the increase is that we're talking about now graduate borrowers are forecast to payat least 7.27 percent and parents will pay 8.27 percent now just to put things in perspectivewhen the federal reserve %uh gives loans primary loans to banks youshould keep in mind that they lend that money at point 75 percent so if you look atthe history and the federal reserve

giving money to banks you'll see thatyears ago it was actually the interest rate was alot higher was about 5 percent and then after 2008 they went down 2.75 percentand that the federal reserve will make the argument that pay the banks hadissues with liquidity and we wanted to make sure that we helpthem out with the short term loans up and of course the banks take themoney and then they landed at a higher interest rate to the american people so that's a little problematic but theywill make the argument the federal reserve will that this isbetter for the economy

yeah know it seems better for the banksincluding hey definitely so it doesn't seem as short term if we'vebeen doing it since 2008 at least and it through c terrible disconnect here where they sayno it's really important to everyone that we give it to the bank said 0.75 so they could lower back to you at 567the wind in the middle men want you just low intermediate point 75 pay know because the banks aretrustworthy book because there be default if we just give it tothe american people or to the students

right no wait a minute the banks or crash in2008 so apparently they're not that so the argument will be that thegovernment shouldn't shoes a the winners and losers right to choosethe bank said they give the point 75 percent to exactly this is total or scrap yen but my biggest problem with this is thatthe average undergrad student takes out twenty six thousand dollars instudent loan debt now that's the average okay so we know that there'sturns out there that take out way more

upwards of a hundred thousand dollars instudent loan debt and we knew couple bad with a 5.75percent interest rate i mean these kids aregoing to be in debt for the rest of their lives and it that really harm the economy you mightthink well i don't have the dead so who cares doesn't bother me well first of all we can get rid of thebankruptcy and also be can actually be part ugh an economywhere they stimulated they're not able to buy cars and housesin certain things that help to stimulate

the economy because their their credit looks bad they haveall this debt that they can't get rid up so now would let's be fair so for civil at least this is a rate that is lowerthan what the students would get a bank now the bank can puts all this money ontop for their own profits now the other part time it is thatthere's going to be a default rate so you can just chargepoint 75 becausesome people will pay you back and you gotta take that into consideration is made everything's and the governmentfor some people says he even pay me back

a your according to your income levelwhich a bank private bank of course doesn't do they don't care what yourincome level is gonna pay whatever you owe them was a government would justhow much you have to pay our in these students for their good side sowhat they're doing there's a reason why it has to be alittle higher than them point 75 but it is officially high now that overthe next decade they're gonna make a 127 billion dollars in profit so now that profit summer goes back toeducation as they say look that way we can get more pell grantsetcetera but the lion's share this goes

back into the normal budget exact sothen they go great we have more money for tax cuts for the rich war wars orwhatever their portion at four right but they're taking it out on thestudents pocket and giving it to everyone else which seems a little perverse absolutelyyet then again the 5.7 is not an atrocious interest rate its likehistorically thought about interest rate but when dj banks though

eve get it so much lower there's anexcellent case to be made by people like senator warner senatorsherrod brown from ohio to say there's a significant injustice here andalso you know at last year's senator warren had proposed legislation thatwould cap the interest rate to what the federal reserve lands tobanks and of course members of congress were buying it because they're in bedwith these big banks course there's the campaign funding andall that %uh but at the same time would say all right that's a little extreme wedon't want that there were some members of congress thatsaid okay at least allow the students to

refinance their loans and politicians are like no nobankruptcy no refinancing get the hell outta herelet's go over the students let's make sure their debt for the rest of theirlives now course still say that this because wewant them to be responsible and if that's the money you owed well that'sthe money you owe except of course in 2008 when the bankswere terribly irresponsible crash in tired ã©conomie and we gave them in essence when youclued the treasury

and the federal reserve s7trillion-dollar baylor what happened responsibility that