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Be honest-what do your student loans go for? (1 Viewer)

Moe Maishlish

Supporting Actor
Joined
Mar 30, 1999
Messages
992
I took out OSAP (Ontario Student Assistance Program) in my second year of University to help get me through completing my Computer Science Degree. I had made a conscious decision after my first year that:
a) My parents would not shoulder the burden for the cost of my post-secondary education.
b) I would do what I had to do to guarantee that I could continue studying in my field of choice.
Having limited funds, I had to go with a student loan. These are not as easy to obtain as one would think, almost every cent went to payment of tuition, books, and other school expenses (parking pass, etc). Some money was left over, and I used it to subsidize my tuition in my next year of school.
In Canada, the system has been seriously abused, and as a result certain actions have been taken to remedy the situation. This includes the hand-off of the loans to the banks, which led to higher interest rates for us students when our loans go into repayment, as well as making it MUCH more difficult to obtain these loans. In the end, a student leaves school in massive debt that goes into high-interest repayment within 6 months of graduation. Having spoken with my father, it wasn't like this 30 years ago... but it is now.
Oh yes... all this also means that less money is actually given out.
After my second year, I began working about 30 hours a week, while completing my Honors Degree in Computer Science, just so that I could avoid the need to continue taking out loans.
Mathew,
student said:
That's ironic, because everyone else can not necessarily rely on a low-interest/no-interest student loan. Low interest rates are granted to students because students are not supposed to necessarily have the money to pay back high-interest items.
Credit Cards are high interest because you're supposed to be responsible enough to know that if you're going to buy something, you're going to need to carry or pay off the extra credit.
Eventually, abusing the system as you're doing is going to raise and change the credit rates on student loans. And then one day, they will no longer be available.
Moe.
 

Joseph S

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Joined
Dec 23, 1999
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Eventually, abusing the system as you're doing is going to raise and change the credit rates on student loans. And then one day, they will no longer be available.
The loans are not forgivable by bankruptcy. They will always be available. As long as he is stating his correct financial assests and income, there is nothing wrong with spending the money as he sees fit. I receive over $12,000 a year in graduate loans for personal expenses and another $30,000+ for tuition. These extra funds are for rent, clothes, books, food, travel, etc. If I can strech the money to include a better tv that is my choice. Share an apt, buy a used car, eat cheap, and enjoy what little free time you have being enjoyed with your HT. You qualify for a certain loan based on your income andassets. You have the option not to take the loan, to taken only part of it, or take all of it. This is money you will have to payback. I find taking all of it lets me live more comfortably and I won't mind paying the money back when I have income. Yes, I may pay 3-4x what I borrowed but I don't care. Financially, I'll be able to do it without a problem.
 

JamieD

Supporting Actor
Joined
Apr 5, 2002
Messages
557
You see how easy it is to arbitrarily draw the line?
Yes, of course I do. But that's why we should resist the urge to do so. If what he is done is not against his areas regulations for spending/loan usage (if there are any), then whatever floats his boat. I attended school with someone who bought whatever he wished with his (maximum sized) loans, ended up 52K in debt, and wishes he hadn't, but was happy during the time. Another friend took his loans, invested as much as he could, and worked as well, and came out ahead. Sacrificed for four years, but came out ahead. But which is the best route is entirely up to those taking the route.

But hey, I see every decision in life as having at minimum two sides lately, so I'm bad in debates, unless you need someone to drive you insane.

Oh yeah, and Lean Cuisine TV Dinners were my staple food.
 

Tony_Woods

Stunt Coordinator
Joined
Apr 16, 2002
Messages
105
bah humbug. All of my student loan money goes toward tuition etc, and I still have to pay some money plus buy books. I'm taking 18 credit hours plus working 20 hours a week just to have money for living expenses. I know some of my friends are the same way though, they got big student loans and just baught toys with it.
 

Joe Szott

Screenwriter
Joined
Feb 22, 2002
Messages
1,962
Real Name
Joe S.
Thank you Joseph S!

Let's remember here folks that this is a loan from a bank, they are not doing this out of altruism as they very much expect to get paid back. The bank makes loans on whether or not they believe you can pay them back, it's not like they have so much money available and then they close up for the day after they loan out enough. They will *always* make another loan to a qualified applicant for the amount the computer tells them is acceptable. It's not like one guy steals it from another by getting more money.

The low interest rate is because students have less money and need to get a foothold after schooling, there is no stipulation that it is for tuition or rent only. I never saw anywhere on any of my student loans where I couldn't use my money as I saw fit. Matthew is endebted to pay back these loans, he is not getting any sort of a free ride from the bank.

If anythying, the people that default on their loans are the ones that make it harder for others. The guy that borrows $20,000 for tuition only and defaults is much more harmful than the guy that borrows $50,000 for whatever he wants and pays it all back on time. As students default, the bank decides they are higher risk and statrs loaning less to future students. So bash the defaulters all you want, but Matthew sounds like a fairly level headed and smart person.

If I wanted an HDTV and could get a 4% loan to do it compared to 16% on a credit card, I would do the same thing. Heck, it shows that he learned some basic economics in college, wish more kids could understand the numbers like Matt.

Anyway, all IMHO. I knew you were going to get flamed the second I read this post.
 

Tim Markley

Screenwriter
Joined
Jun 12, 1999
Messages
1,279
This isn't anything new. When I was in college (83-88) students were doing it also. I financed my whole college education through grants and student loans because my parents couldn't afford it. At the end of my Sophomore year I had some money left over from my student loan and I purchased my first 'real' stereo system. All JVC equipment but that was high-end to me at the time. Looking back on it, I should have saved the money and used it the next year but I was young and foolish. Every other year I needed every cent that I got from my loan for tuition, living expenses, books, etc.
 

Nathan_F

Second Unit
Joined
Feb 6, 2001
Messages
274
Location
Fishers, IN
Real Name
Nathan
The problem is that a student may or not may be paying the interest on these loans while in school or during a deferred period (such as 6 months after graduation.) During that time, the government (and thus, we, as taxpayers) are paying for HDTVs and 2 new cars... What a waste.
 

Moe Maishlish

Supporting Actor
Joined
Mar 30, 1999
Messages
992
Joe,
I'm not sure how it works in the US, but in Canada, only certain people are granted OSAP loans. And the more people that apply, the harder the decision process is. This policy came into effect in the last decade because of the massive abuse that the system was put through. People would borrow money for school, default on the loan, use it for other purposes, etc. It was a big deal a few years ago when the system went through reform.
Furthermore, we don't apply for a specific amount of money. We simply apply for a loan, and if we're accepted, we receive a note in the mail telling us how much we've been granted. The loan is not guaranteed, and is seen as a priviledge, not a right. It's meant to be given to those who need the money for their educations... that's the "weeding out" process.
The loan process consists of filling out an application which requires you to state your earnings, and that of your family. The loan application however does not distinguish between people who's parents are willing to foot the bill for their educations, or students who wish to pay for it themselves.
Simply said, if your parents have a high income, then you're screwed. It doesn't matter if they don't have any disposable income. Your parents could have made $100,000 last year, but needed $30,000 to fix the roof, $20,000 for a new car, $15,000 for Jenny's wedding, and $20,000 to bail little Jonny out of jail. They'll have none left over to send you to school, but the govenment won't see it that way, and will deny your student loan requirest. Period.
I know several people who were in this exact situation when they wanted to go to university. They had no money themselves, but their parents incomes were too high for them to qualify for OSAP. As a result, they were forced to put off going to school while they earned money for the educations, or had to get regular loans from the bank (which higher interest rates than regular OSAP student loans).
Them's the breaks... why? Because the couldn't qualify for OSAP. Why? Because their parents made too much money, but still couldn't afford to send them to school. Why? Because the system was changed to protect those who really needed the money for school. Why? Because people abused the original system and used the money for non-scholastic purposes.
Keep this mind mind though... essentially, the government pays the interest on the loan while we're students (and where does the gov't get it's money from?), after which we're required to pay it back. During the period that the interest is paid by the government, who is paying for Bob's new HDTV & Jane's new SUV, purchased with "student" loan money?
Moe.
 

Andrew Pratt

Senior HTF Member
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Dec 8, 1998
Messages
3,806
I admit to spending some of my student loan on things that I shouldn't have but most of it went to living/tuition expenses...but we were all young once and have made choices that we might not make now that we're older.
 

Joe Szott

Screenwriter
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Feb 22, 2002
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Joe S.
Moe,

In the states as best I can recall it is just an agreement between you and the bank, just like a regular loan. Student loans are available to everyone, based on their own personal credentials. They take into account what kind of career you are looking at after school and your current financial situation to decide the amount you can borrow, but it's not like the money ever runs out. My parents can make $200,000,000 a year and I can still get student loans (probably more than someone who needs them more, because my family has more assests to back the loan.) Obviously, it is a special loan as you must prove you are a student and the rates are low, but it is essentially a personal loan in the end.

So if Matthew wants to buy HDTVs and cars, then who really cares. If we are going to get into an arguement on how USA tax dollars are being wasted, student loan interest abuse isn't even on the charts. The cost to send the current troop buildup to Iraq is already greater than the entire history of student loan abuse in the USA, and we haven't even started the war yet. I don't want to deride this topic with political views, but my point here is that the gov't uses up our taxes no matter what -- I would rather have Matthew chew up a very small amount getting some pleasure while educating himself than to have it send him off to get shot over oil in a foreign desert. What's the greater good to our nation, giving our future educated leaders a little lee-way, or trying to control a foreign oil supply?

Man, I do apologize in advance if I offended anyone's sensibilities with this post, it is just an opinion.
 

Moe Maishlish

Supporting Actor
Joined
Mar 30, 1999
Messages
992
Joe,
Don't worry, I'm not offended... :D
The clincher for me is that people who abuse the system here are literally taking money away from those who truely need it.
So in my eyes, Bob's education as a doctor/dentist/lawyer/accountaint/whatever is more important to our society than Doug's new sportscar, or the new components in his HT system.
I won't go into a long diatribe about the benefits of an educated society, but I will close off by mentioning how important I consider education to be. It's somewhat tragic to think that those who truely want one (and can be practical and potential contributors to society) are denied the means to obtain one by those who seek to abuse a charitable system.
Moe.
 

Bob Movies

Stunt Coordinator
Joined
Oct 15, 2000
Messages
200
I'm with Moe, a fellow OSAP'er. I'm a university student who will be graduating in April. It bothers me very much to see people abusing their student loans. I've worked every school year and every summer, and with the loans I've received I barely have enough to pay my tuition.

Along the same lines, a guy in my class received $3000 extra on his student loan and said he was going to play the stock market with it. I know that he doesn't pay his rent or his tuition (his parents do) so this is just "play money".
 

Charles J P

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Its a catch 22. Basically if while living or attending school with the assistance of any loan, then any money you spend on non school related things is in theory money you should have deducted from the loan offer and refused. i.e. you work at the student union for two hours and make $12. You use that money to buy a case of beer. Shouldnt you have spent that $12 on something school related and refused $12 of your student loan? As you can see, this can be carried forward. I worked all throughout college also bought most of my current HT in college. I was also on student loans and at some times grants. How do you know whether I paid for my tuition and books with the loan and bought the stereo with my own money or vice versa? It makes no difference. So, anyone who spent any money on non-school related items while attending school on subsidized loan or grant has no room to talk.
 

Mathew Shelby

Second Unit
Joined
Dec 5, 2002
Messages
344
See what I started? I am not trying to start a war, only explain how I have used "some" of my student loans. I am not out to corrupt the system at all. I know I am responsible for every penny I borrow and I have every intention of paying it back. My girlfriend and I live more comfortably than all of our other college friends and I know I will spend the next 5-10 years after I graduate paying for it. After four years of college, I owe just under $15,000. 2/3 of it went for tuition. For those of you who say that I am just another lazy college student-you might ask what I do for a living. I install garage doors in homes from 6am-3pm and then go to class from 4-10pm. I have no spare time. What "little" time I have left is spent watching movies on my HT. How can everyone criticize me for budgeting money the way I see fit. A typical day for me is 18 hours long. And I have never gotten below a B in four years of coursework. How many of you can say that? I work harder than all of my friends just to maintain the level I am at. Sure I could go out and get trashed every night like all the other college kids I know-but I can't install a garage door with a hangover the next day. I earn my keep and I realize there is no such thing as a free ride.
 

CaseyLS

Second Unit
Joined
Oct 3, 2002
Messages
370
I am getting around a 400-500 dollar return and more than likely I am going to use that for one month's rent to give my parents a break. With Fin aid my tution and books are covered and my parents and I split room and board. Personally I think it is stupid people can use grant money for toys but I don't have a problem with loans(which I get)

If my parents tell me to keep I will get new speakers.
 

Mathew Shelby

Second Unit
Joined
Dec 5, 2002
Messages
344
Where I go to school, grant money is never given to the student. If a student receives a grant (I do not-only loans), the money goes to your college's financial aid department and is put towards what you owe. If there is a surplus, the grant money goes back into the general fund available to another student. If there is a balance, you get the bill. A student at FSU will never see a grant check, only loan checks. It is my opinion that everyone is eligible can get a loan. If you choose not to take one, that is your problem. I take what I am entitled to and nothing more. Anyone who want a loan for school can get one (at least that is how it is in Florida). Florida has set a limit as to how much you can get (max $3500/semester)
 

D. Scott MacDonald

Supporting Actor
Joined
Oct 10, 1999
Messages
545
In the states as best I can recall it is just an agreement between you and the bank, just like a regular loan.
The student loans that I received where guaranteed by the government, meaning that if I defaulted the government (meaning the taxpayers) would loose the money and not the bank.

As Matthew has explained that 1) he uses a large part of the loans for tuition and books and 2) he plans on paying them back, I have no problem with his use of the loans.

I do have a problem in general with people running up large student loans for frivolous stuff, however simply because a certain percentage of these loans will default, and if people run up the debt in frivolous ways, the amount defaulted could start causing problems. I'd hate to see the government be forced to cut back on these loans someday as there are many, many people who require them to make a better life for themselves.
 

Justin1

Stunt Coordinator
Joined
Jan 4, 1999
Messages
115
In five years (MBA) of schooling, I had to eat ramen noodles and drink cheap, crap beer just to make ends meet. My loans were pitifully low, not nearly enough to buy a new tire, let alone pay for an HDTV or down payments on two very nice vehicles. Damn, I should have gone to school in Florida.
 

Philip_G

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Nov 13, 2000
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it's almost as if those that are against spending the excess are bitter because they had none.
You can ALWAYS go in to your finaid office and have your allowance bumped around, the big one here is to consider your actual living expenses, and not just the average.

I'm not sure what world you're living in, but most of my classmates (well, the ones without rich parents) are racking up 50-80k in student loans, and none of them have ever been told "sorry, we gave away all the money and you can't have any" there's ALWAYS an alternative, plenty of banks offer some very attractive private loans. If you went a little short and couldn't cover your tuition and expenses, it's your own damn fault, plain and simple.

for whomever mentioned it, I can't speak for all loans, but all of mine I can assure you the "juice is flowing" the instant it is disbursed to the school. I'm not aware of any deferred interest available. Some may have it, mine do not (stafford, un-sub'd and GOAL loans mostly)
 

Jon W H

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Joined
Oct 31, 2001
Messages
155


My financial aid office has told me they are sticking by my FAFSA, which got screwed up by the Dept. of Education last summer. Despite having lived on my own for years, independently and just scraping by, my subsidized loans are just under the line for me to make tuition. Which means I have to find some other means of help, which I don't have yet. I even asked if I could file a "sudden change of income" form and they said it would be reflected in the next FAFSA. Doing me no favors right now.

Walk a mile in my shoes and perhaps you'll see there are people who struggle to further their education.

P.S. I'm going to a cheap school, albeit out of state, which is why I'm eagerly anticipating permanent residency.
 

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