We regularly meet with folks who are in danger of losing their homes because they can’t afford to pay their mortgage due to the amount of consumer debt they owe. One of the most common (and largest) consumer debts we see is student loan debt. Get this: 5.9 million homeowners under the age of forty pay over $250 a month for student loans!
The politician who invented the phrase “student loan” was an incredibly devious marketer…as well as a manipulator of the facts. It’s my guess that several of the big banks were included in this lending scheme.
Why do I call this a lending scheme? Simple: if you get a mortgage, what is the only thing the money can be used for? To buy a specific home, right? How about an auto loan – a specific car, right? But with a student loan, the money borrowed can be – and often is – used for ANYTHING…to buy a motorcycle, to go on lavish vacations, to buy a plasma-screen TV, etc. And that’s exactly what too many “students” do with the borrowed funds!
In the end, many students owe the bank $50,000 or more! And here’s the sad part – a good percentage of these “students” never get their sheepskin. This means they start adulthood with no degree and…