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Archive for December, 2008

Student Sells Sex – To Professor – To Pay for Tuition

December 18, 2008 2 comments

A University of Michigan law student who needed extra money for tuition and couldn’t get a loan because of the credit crunch has been charged with soliciting sex for money on Craigslist.  From the Ann Arbor News:

The student told police she was advertising sex acts online via Craigslist to help pay tuition costs. For an in-state student, U-M Law School tuition is $41,500 a year; out-of-state students pay $44,500.

But the creepiest thing about this story is that the prostitution came to light after she accused one of her clients, Yaron Eliav – who just happens to be an associate professor in Michigan’s Department of Near Eastern Studies – with assault.  Since this blog is focused solely on student loan issues, I won’t go into the salacious details here, but if so inclined, you can read them for yourselves at the links above.

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Some New Jersey Borrowers Now Forced to Make Loan Payments While in School

December 17, 2008 Leave a comment

I think this is the most depressing story I’ve yet seen since the economic crisis really started hitting the news a few months ago.  NJ.com reports that NJ Class Loans, a state-sponsored lending agency, will now require new borrowers to make student loan payments while they are still attending classes:

The state agency overseeing more than $1 billion in college financial aid will no longer allow students to defer payments until after graduation — a move that could affect thousands of students at a time when it is getting increasingly difficult to secure loans elsewhere.

I have heard of private loan companies doing this, but I’ve never yet seen this done in a loan program sponsored by the government, and I think it’s appalling.  I worked between 10 and 30 hours a week nearly every semester I was in college plus sometimes as many as 50 hours a week during the summers, and I never would have been able to make it if I’d had to make loan payments while in school.  My work money paid for rent, and books, and food.  I don’t know what kind of money college students are making in the minds of these policy-makers, but when I was in school you were considered very lucky if you found something a dollar or two above the minimum wage.  I think a lot of people are going to wind up dropping out of college if this becomes a trend.  Very sad.

Arne Duncan is Obama’s Choice for Secretary of Education

December 15, 2008 1 comment

The Associated Press is reporting that Obama will name CEO of the Chicago Public Schools Arne Duncan as his choice for Secretary of Education on Tuesday morning:

Duncan has run the country’s third-biggest school district for the past seven years. He has focused on improving struggling schools, closing those that fail. Obama highlighted this work by choosing for the announcement a turnaround story for Duncan — Dodge Renaissance Academy, a school Duncan closed and then reopened.

Duncan is a 1987 graduate of Harvard, magna cum laude, who played professional basketball in Australia for four years before returning to the United States to direct the Ariel Education Initiative, which focused on increasing educational opportunities for inner-city youth.  Apparently, Duncan is popular with both the pro-No Child Left Behind  faction and the teachers’ unions. 

Well, I’m a little disappointed.  I was hoping, in spite of indications to the contrary, that Obama would appoint someone whose major focus was reforming higher education.  I did find this quote from Duncan on the Huffington Post, in which he mentions student loans:

“Oh, there are lots of challenges and, obviously, huge opportunities,” Duncan said. “I think there’s a huge amount of work that has to go on on the early childhood side. There’s a huge amount you’ve got to do in the K to 12 sector. And higher ed, particularly the student loans, presents some huge, huge challenges.”

Not exactly a call to arms, and he could easily be talking about access to loans during the credit crunch rather than more radical reforms decreasing the necessity of huge debt loads for college students, but I will hold out hope until I’m proven wrong.  More as this one develops.

A Lifetime of Debt

December 15, 2008 3 comments

Writer Magdalene Perez has a great op-ed piece in The Stamford Advocate describing her student loan debt – about $57,000 that she expects to be paying on until she is 50 years old.  Things ain’t how they used to be, she claims.  Talking about her grandparents:

Having a simple business degree instantly changed their lives. Joe got a job at a tire company in Minnesota, and with just one income he supported his family, which quickly grew to include four kids. In less than six years, the family had enough money to buy a house, which they quickly traded for a larger one.

Magdalene sees a bleaker picture for her own generation: Read more…

Is College Still Cost-Effective?

December 14, 2008 1 comment

News-record.com has a great human interest story on how young, college-educated adults are fairing in the current recession.  As you may have guessed, the answer is, not great.  The article talks about people graduating college and not being able to find a job, getting laid-off, and putting off purchasing homes and cars because of the economy.  And one story in particular touches on the problem of student loans: 

Read more…

Joining the Army – a Good Alternative to College?

December 14, 2008 Leave a comment

This article out of HattiesburgAmerican.com, a Mississippi newspaper, tells the story of Ebonee Ervin, an 18-year old who has decided to drop out of the University of Southern Mississippi because she can no longer afford the tuition; she’s joining the army instead.

The article also talks about a general upswing in the number of students who are leaving school early amid financial woes: Read more…

Fewer Taking GREs

December 8, 2008 Leave a comment

US News & World Report notes that the number of people taking the GREs has dropped from 633,000 last year to between 621,000 – 625,000 this year.  What’s interesting about this is that ordinarily, an economic downturn is accompanied by a rise in graduate school applications.  The article mentions several reasons why things might be different this year:

  1. This year is just an anomaly.
  2. This recession is different from ones past and people are “feeling poorer” or are clinging to their jobs more strongly than before.
  3. The perception that the private student loan market is tightening up.
  4. The perception that school budgets are being slashed and fellowship opportunities are drying up, discouraging applicants.
  5. The rush will come soon enough. “It could be that this has created a temporary pause where we would have normally seen a flow to graduate school,” said Debra Stewart, president of the Council of Graduate Schools. “That the flow hasn’t started doesn’t mean it won’t.”

I’m curious to hear what you all think.  Has anyone out there been thinking of graduate school and decided to put it off for a while, and, if so, why?