Since they do not get to negotiate the terms of the loans as they are mostly only interested in getting money to take them through college, te find that after they receive and spend the cash the deal may have been more complicated than they anticipated. I addition, te repayment periods can be extremely long and there are people who are still paying these loans as many as 20 years after they graduate, this makes it difficult to build emergency savings of investment accounts since majority of them will make enough to survive on let alone service expensive loans (Vidal).
In addition, een if one is having financial hardships, i is almost impossible to get rid of these loans and they follow one even in case they get medical emergencies or lose their jobs. For many who do not earn a lot of money, tey will be forced to spend their savings in paying off their educational debts and this eats into their retirement funds. Dfaulting on payments for these loans irrespective of the reason can cause one have bad credit with makes it both difficult to borrow money or obtain employment in some professions.
Dfaults on student loans are not removed from ones credit history and even after 7 years, tey will not be wiped away nor are they discharged during bank proceedings. I they are not paid as agreed, tey can result in wage garnishments and a simple four year loan can result in bad credit as well as debt repayments. In addition, i does not matter if one graduates or not, tey must pay the loans, i is very unfortunate that there are thousands of people paying loans even though they were unable to clear college for any number of factors and they do not even have a degree in the first place.
Many in such situations end up making low level incomes since their income levels do not match with the loan repayments making these deductions a serious hardship for them. To some extent the process of recovering these loans can be injurious and retrogressive but only for the recipients since the institutions must get their money back whatever the case.
Hwever their demands and inflexible rules sometimes make it even more difficult to pay back these loans; fr example since one gets bad credit for not paying them they will not manage to get a loan for maybe a startup. Tking away their opportunity to make money for themselves makes it more difficult for them to earn enough to make the necessary payments. Sveral reforms have been considered...
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