Student loans are worth it in the end

Student loans are worth it in the end

Student loans are worth it in the end
January 25
07:47 2017

Nate Jackson | Staff Writer

Within all of the skepticism, which we direct towards the establishment, lies a beacon of hope.

According to the Consumer Financial Protection Bureau, they are suing the Navient Corporation, “the country’s largest servicer of both federal and private student loans for systematically and illegally failing borrowers at every stage of repayment.”

Before attacking the problems with this situation, take a moment to figure out how we arrived at it.

Federal student loans were not widely available to common citizens in the beginning, and neither were Pell Grants. The Space Race between the United States and the USSR motivated Congress to change legislation and allow people who were not veterans to receive help from the federal government.

They were determined to show the world that capitalism was better than communism, which I strongly agree with, and that free enterprise was key to the American Dream.

Correspondingly, the U.S. Department of Education was created thereafter with the intent to ensure equal access to education for all citizens.

Knowing the history behind the federal and private student loan programs is significant because it allows people to understand that the intentions behind them were pure. At a point in our history, higher education was a luxury for no one but upper-class Americans.

These programs were created to safeguard an opportunity to advance the disenfranchised and underprivileged, and to provide a better way of living for their loved ones.

This legislation is, retrospectively, life altering. Especially for the majority of students here at the University of North Texas. As much as some people may hate to admit it, many college students came from middle-class families, making it nearly impossible for them to avoid student debt.

In fact, almost 70 percent of 2016 graduates left college with debt, according to the Wall Street Journal. The average student debt last year was “$37,172 per student,” said student aid analyst Mark Kantrowitz.

Either way you put it, we represent the run-of-the-mill American. So before the Space Race and the conception of the Department of Education, we would’ve been bound to grunt work without the chance to ascend in socioeconomic status. All things considered, with capitalism being its motivating factor, federal student loans were bound to be a target of exploitation.

Don’t get me wrong here, I believe capitalism is a great system in almost every case. But where does it stop?

Apparently nowhere in the case of Navient. For borrowers, one of the most alarming charges in the CFPB complaint is the allegation that “they incentivized employees to encourage borrowers to postpone payments through forbearance.” This is an option in which interest continues to pile up, rather than have borrowers enroll in an income-based repayment plan that can help them avoid fees.

In turn, Navient amassed $4 billion in interest charges to the principal balances of borrowers who were enrolled in consecutive forbearances.

Student loan servicers are supposed play the middleman. By definition, this is exactly who they are: an essential, trusted link between borrowers and lenders. They’re supposed to handle the borrower’s account, process monthly payments and be your direct line of communication when it comes to your loan.

We’ve almost come to a point where we expect infractions like these from Wall Street, not from the people who are supposed to be in your corner to battle “the man.”

The reason why this lawsuit should matter to you is because it shows that, despite electorates’ cynicism towards the government, there are still high-ranking government agencies who care about college students. We’re not in this alone.

If you’re anything like I am, you do everything in your power to avoid thinking about loans. We have more than enough obstacles to bear, like getting internships and finding a solid job.

Is taking out a loan and attending college worth it? Absolutely. An education is an investment to begin with, and is something no one can take from you. Don’t allow the thought of paying back loans cripple you. Choose optimism, not cynicism.

Featured Illustration: Antonio Mercado

About Author

Preston Mitchell

Preston Mitchell

Preston served as the Opinion Editor of the North Texas Daily from July 2016 to July 2017, and is a UNT graduate of integrative studies.

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