Josh Mitchell
speaker
438 appearances
7 recordings
1 series
first heard Jul 2017
last heard Feb 2022
Josh Mitchell’s voice in public audio — every appearance, attributed to the second.
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Appearances
where basically people have assumed, oh, a college degree is always going to pay off.
Therefore, taking out debt is a good investment.
You'll always be able to pay it off.
And guess what?
People are not able to pay it off as much as they thought they would.
And so now it's the same type of process that mortgage lenders went through 12 years ago where they started to see on their books, oh, we're not getting as much money from homeowners that we thought we were
holy crap you know we're in we're we're out of luck here and we have to change our lending practices right now the trump administration sort of behind the scenes are starting to see the same thing you know it's like oh my god uh we projected that we would earn this much money on loans we're actually losing a ton of money and they're starting to realize that this very this this era of loose lending is actually leading to a lot of people in distress
The private student loan market actually had its own era of loose lending, which coincided with the housing bubble.
So back then, around 2000 to 2008, just as the housing bubble was being inflated, there was actually a private student loan market in addition to the federal student loan market that actually had very loose lending.
What ended up happening is when the private markets froze in 2008 because of this broader financial crisis, you had private student lenders start to see, oh my god, a lot of people are not paying their loans.
We need to start to underwrite better.
We need to start to pay closer attention to what type of schools people are going to.
And they started to look at their credit scores and they started to have their parents co-sign.
So private lenders ever since then, which is the same thing that's happened on the mortgage side, they've been very much tighter about who they give loans to.
The federal loan program has not done that.
It's still maintained this very loose levels of credit.
Now, there's reasons for that, and the intention is if you are American who wants to go to college, you should not be prohibited from going because of lack of money.
And so that's the point of this program.
So there is something to be said for if you do impose underwriting, you might prohibit people or prevent people from going to the college of their choice.
But the tradeoff of that is that a lot of people are not paying those loans, and there's actually data, strong data, strong information that Congress has at its hands right now to know who's most at risk of defaulting, and they're not really using it the way they could be.
Showing 121–140 of 438 · page 7 of 22
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