Washington Post: As college costs rise, loans become harder to get

Posted by Kendall Harmon

When Daniel Ottalini entered the University of Maryland in 2004, his family had an array of choices to cover the cost -- cheap student loans, a second mortgage at low rates, credit cards with high limits and their own soaring investments.

By the time his younger brother, Russell, started at the University of Pittsburgh this fall, the financial crisis had left the family with fewer options. Russell has had to juggle several jobs in school, and the money he could borrow came with a much higher interest rate that could climb even further over time.

The upheaval in financial markets did not just eliminate generous lending for home buyers; it also ended an era of easy credit for students and their families facing the soaring cost of a college degree.

Read it all.


Filed under: * Culture-Watch • Education • * Economics, Politics • Economy • Personal Finance • The Banking System/Sector • The Credit Freeze Crisis of Fall 2008/The Recession of 2007-- • The U.S. Government

1 Comments
Posted December 29, 2009 at 7:22 am [Printer Friendly] [Print w/ comments]



1. midwestnorwegian wrote:

The article doesn’t talk about the “College Cost Reduction Act” which the democrats pushed through approximately 2 years ago.  It was a misnomer which did nothing to reduce the costs of school, but destroyed incentive for banks to originate student loans.  There have been over 100 banks which have completely left the student loan market since this democrat legislation, reducing competition in the market while driving up rates and reducing the tools available to lenders regarding deferments and forbearance time on loans.  Meanwhlie, the Universities (including a recent well publicized action by the board of regents at the University of California) have been jacking up tuition by as much as 30%. 

So, blame Democrats (who have zero understanding of basic economics) for destroying the student loan lending industry WHILE trying their damned best to line the pockets of their most ardent constituency - the socialist professors who followed Marx’s direction to “Sieze the universities”.

December 29, 11:10 am | [comment link]
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